Page 7 - ar2011_2012

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ANNUAL REPORT 2011/2012
Chairman’s Message
However, the deal did not materialise when
the prospective buyer wanted better terms.
We will only take proft when it is opportune
and, given our solid fnancial standing, it is
unnecessary to be overly generous to terms
and guarantees sought by prospective
purchasers.
As always, the Group’s commitment is
to deliver value to shareholders through
business acumen grounded in fnancial
prudence and pragmatism. Hence, we are
always prepared to give serious consideration
to offers that can deliver what we perceive to
be excellent value for our shareholders. At the
same time, we also seek to creatively unlock
greater value from our existing properties
through re-development. Currently, we have
plans for two re-developments in Sydney.
In the fourishing hi-tech Macquarie Park,
we are awaiting the authorities’ approval for
the redevelopment of Stamford Grand North
Ryde. On this 22,400-square metre site, we
are proposing an A$375-million development
named Macquarie Park Village. It would
comprise 10 towers with a total of some 625
apartments that would be affordable to the
thriving pool of professionals working in the
vicinity. The development will have about
44,000 sqm of net saleable area.
We are optimistic that the project would
be successful given its excellent location
in Macquarie Park. It is also very near
Macquarie University and Macquarie
University Hospital. Moreover, the Sydney
CBD is a mere 20-minutes’ drive away. In
addition to homebuyers, we believe property
investors would be attracted to the project
for its good rental yield. We are targeting
pre-sale of the units in the middle of FY
2012/2013. The show apartment and project
display facility would be opened to the public
by October this year. However, this would not
affect the smooth day-to-day operations of
the hotel.
We also have exciting plans for the
redevelopment of Sir Stamford at Circular
Quay into an up-market residential
development of 96 apartments with about
13,000 sqm of net saleable area. Original
plans were submitted to the Council of the
City of Sydney in December last year but
were withdrawn in April this year to review
the proposal due to certain historic and urban
design considerations. We intend to lodge a
new development application by June this
year.
Since the Sir Stamford at Circular Quay
is doing well, the project schedule of the
proposed development would depend on
our reading of the luxury residential property
market trend in the Sydney market to optimize
sales revenue.
PROSPECTS
Weakness in the global economy is expected
to continue in 2012 with ongoing challenges
facing the Eurozone. However, we expect
our hotel segment to perform satisfactorily
for FY 2012/2013 since more than 70% of
our hospitality revenues is derived from local
clientele and the Australian economic outlook
remains stable. Although overseas markets
will provide lower contributions due to the
weak economic environment and strong
Australian dollar, this will be partially offset by
increasing demand from China.
We expect our Property Investment segment
to continue to perform positively, underpinned
by the fxed lease income of over A$10 million
per annum from Dynon’s Plaza.In addition,
the Group expects to continue to recognise