Roxy-Pacific all set to ride property upturn

It may launch eight sites totalling 546 units here for sale this year, says CEO

Thu, Feb 15, 2018

Yunita Ong


FOLLOWING a softer 2017, Roxy-Pacific Holdings is back in the game - just in time for the property upturn.

The property and hospitality firm could launch eight sites totalling 546 units here for sale this year, said executive chairman and chief executive Teo Hong Lim.

Besides The Navian at Jalan Eunos in January, sites confirmed to be launched this year include Upper Bukit Timah Road, Grange Road, Guillemard Lane, Harbour View Gardens at Pasir Panjang and River Valley. These are expected to contribute positively to earnings progressively from Q1 2019.

Roxy-Pacific may also launch for sale Dunearn Road and 5 Derbyshire Road by end-year, Mr Teo said on Wednesday at a results briefing.

He believed that Roxy-Pacific has an edge as an early bird, having acquired its current land bank of 10 sites from as early as November 2015.

The other two sites are Lorong Kismis and 22 Farrer Road, both picked up in January this year.

"A lot of the en blocs that are bought this year can only launch in the middle of next year or even longer," he said. "Being the first to launch allows us to capture some of the market, balance the risk, and lock in the profit before we go again."

Roxy-Pacific recorded a 41 per cent slide in net profit to S$29.4 million for the full financial year, it announced on Tuesday evening.

This was largely due to lower contributions from their property development segment, which made up 78 per cent of the group's turnover, following the completion of Jade Residences, Whitehaven, LIV on Wilkie and LIV on Sophia in Q4 2016 and early 2017.

A total pre-sale revenue of S$459.4 million will be progressively recognised from the first quarter of 2018 to 2020 from Trilive and Straits Mansion in Singapore as well as developments in Malaysia and Australia.

With S$234.4 million in cash and cash equivalents, Mr Teo said: "We have to launch and sell, while keeping a budget for good deals." He noted that to-date, its strategy given the company's smaller size has been to seek "unique or niche sites for better pricing". "That's where we can push the margin," he said.

The firm's hotel revenue in 2017 fell 4 per cent to S$44.3 million, mainly due to lower corporate bookings at Grand Mercure Roxy Hotel and competition from new hotel supply.

The company also expects Grand Mercure's RevPAR to improve in 2018 thanks to banner events like the Singapore Airshow, although it said it does not expect "major RevPAR jumps".