STAMFORD LAND CORPORATION LTD
OPERATIONS REVIEW
PROPERTY DEVELOPMENT
Our property development segment delivered
a strong set of results for FY2015 against the
backdrop of a buoyant Australian property market.
Operating profit for our property development
segment increased to S$21.5million, in part
attributed to the sale of Dulwich Hill site. The
sale delivered a net profit comparable to a typical
profit margin for development projects less related
development risk.
Two units of The Stamford Residences and The
Reynell Terraces were sold, amounting to some
A$8.4million in sales revenue. Subsequent to 31
Mar 2015, another two units were sold, including
a penthouse, which fetched a record selling price
for this development. With these transactions, only
one penthouse remains for sale.
In addition, 18 units of The Stamford Residences
in Auckland were sold, with sales revenue totalling
NZ$16.8million. As at 31 May 2015, a further two
units have been sold for NZ$2.4million. Of the
remaining nine units, six units are tenanted.
Construction for Macquarie Park Village (“MPV”)
officially commenced in January 2015. Sitting on
the former SGNR site, the 648-units project is
slated to complete in 2018.
As development application (DA) approval for a
portion of the carparks was not granted, some 142
unitsareunderreconsideration,withsomepotentially
being rescinded. A resale campaign is underway. In
view of the buoyant Sydney property market, many
units currently hold higher valuations.
Last year, the Group reported it had secured the
freehold title of the Sir Stamford at Circular Quay
(“SSCQ”) located at the historic Macquarie Street
and lodged DA for a proposed value enhancement.
Redevelopment plans were challenged by the
owner of an adjacent building and adjudicated
before the courts. Although our application had not
been approved in its current form, it is within the
prerogative and strategy of the Group to continue to
seek the best use of our assets. Besides alternative
uses, the property continues to turn in stellar results
in the 5-star hotel market for FY2015.
PROPERTY INVESTMENT
The property investment segment continues to post
stable results with good rental income fromDynon’s
Plaza Perth. Whilst this prime CBD property is
anchored by a lease to Chevron Australia until April
2020 and continues to generate a steady stream
of rental income, the Group is cognisant of the
softening Perth market given the slowdown in the
resources sector.
As the weak business environment is unlikely to turn
around quickly in the near term, we have recognized
a fair value write down of S$7.8million for the asset.
