UOL plans to launch 3 projects in Singapore, London next year

Private housing project in Potong Pasir Ave 1 slated to start sales in 2018

May 13, 2017

KALPANA RASHIWALA


WEE Cho Yaw-controlled UOL Group (UOL) plans to launch three projects next year - two in Singapore and one in London - with a total of about 1,050 apartments.

The property and hospitality group, which posted a 4 per cent increase in first quarter net profit to S$80.3 million, is looking to begin sales in 2018 for a 99-year leasehold private housing project in Potong Pasir Avenue 1. It bought the plot on the Raintree Gardens site via a collective sale last year, through an equal joint venture with its listed associate United Industrial Corporation. The plan is to redevelop the 201,403 sq ft site into a project with about 750 units.

Also slated for release in 2018 is a freehold project of about 140 units that UOL is developing at 45 Amber Road .

At its freehold Bishopsgate site in London, approval has been obtained to build a 43-storey tower with 160 residential units, 237 hotel rooms and a retail component. The residences are likely to be launched next year. UOL fully owns the London and Amber Road projects.

UOL said the 4 per cent increase in net earnings for Q1 FY2017 was due mainly to contributions from ongoing and new property development projects.

Revenue rose 6 per cent to S$350.7 million from the year-ago period on the back of higher progressive recognition of revenue from two ongoing Singapore residential projects that were launched in 2015: Principal Garden and Botanique at Bartley.

Revenue from property development rose 12 per cent to S$183.3 million. Revenue from property investments increased 2 per cent to S$56.5 million - thanks to office and retail rents from the 110 High Holborn in London which was bought last June.

Hotel operations revenue dipped to S$104.6 million in Q1 FY2017 from S$104.9 million in Q1 FY2016. Revenue from management services climbed 16 per cent to S$6.3 million.

The group's hospitality business spans 9,807 existing rooms (predominantly hotel rooms, but also 683 serviced suites).

Share of profit from associated and joint-venture companies inched up 1 per cent to S$34.4 million due mainly to new contribution from The Clement Canopy condo project in Singapore which was launched in late-February, and Holborn Island in London, which was acquired last November - offset largely by the absence of contribution from the Thomson Three project, which was completed in May 2016.

Earnings per share rose to 9.98 Singapore cents in Q1 FY2017 from 9.68 Singapore cents in Q1 FY2016. Net asset value per share rose to S$10.27 as at March 31, 2017, from S$10.10 as at Dec 31, 2016. Gearing ratio remained unchanged at 0.24 time over the same period.

The counter ended at S$7.07 on Friday, down 3 Singapore cents from Thursday's close. The group released its results after the stock market closed.

UOL said conditions in Singapore's private residential market appear to be stabilising following recent tweaks to the property cooling measures and improved sentiments. "The pressure on office rents has abated with improving take-up rate and an expected slowdown in supply. Retail rents remain under pressure from new supply and competition from e-commerce."

In London, the group said the outlook for the commercial property market could be weighed down by economic uncertainties, but the impact on Holborn Island, a nine-storey freehold mixed-use property, and 110 High Holborn - both in Midtown - could be mitigated by limited supply in the precinct.

The Asia-Pacific hospitality sector could be affected by the uncertain economic and political outlook, UOL added.