SINGAPORE (THE BUSINESS TIMES) - City Developments on Tuesday (May 24) posted a 41 per cent year-on-year drop in homes sold for the three months ended Mar 31, the first full quarter since cooling measures were implemented in December last year.
The mainboard-listed property developer and its joint-venture associates sold 188 units with a total sales value of $477.9 million for Q1, versus 319 units with a total sales value of $513.6 million a year ago, CDL said in a business update for its first quarter.
While the cooling measures have impacted transaction volumes momentarily, the group foresees the property market to "remain resilient and housing prices to hold firm due to moderate supply and strong underlying fundamentals".
CDL's latest launch, Piccadilly Grand, a joint venture with MCL Land, saw strong take-up when it was marketed in May. Some 315 units or 77 per cent of the Farrer Park project's 405 apartments were sold on launch weekend at an average of $2,150 per square foot.
In the pipeline are another 1,000 residential units coming up at two recently acquired sites. In January, CDL partnered MCL to put in the top bid of $768 million for a 210,623 sq ft state land plot at Jalan Tembusu in the east. The project will yield about 640 units.
In April, CDL acquired a 179,007 sq ft site at 798 and 800 Upper Bukit Timah Road for $126.3 million, which, subject to planning approval, it plans to redevelop into a residential project with over 400 units.
The group's hotels saw global occupancies recovering to 52.2 per cent in Q1, up from 36.8 per cent year on year.
Global revenue per available room (RevPAR) recovered to $89.60 from $44.40, up 101.8 per cent year on year. Meanwhile, the average gross operating profit margin rose 8.5 percentage points year on year to 14.6 per cent from 6.1 per cent.
CDL believes this is due to the easing of Covid-19 travel restrictions and a high vaccination rate in the majority of the countries where the group operates.
In Singapore, the group's hotel businesses are picking up. It recorded a 74.3 per cent surge in average room rate and a 43.8 per cent rise in RevPAR. This came on the back of higher demand driven by staycations and corporate groups, as well as 2 hotels catering to the government quarantine business.
For its investment properties, CDL's Singapore office portfolio had an occupancy of 93 per cent, above the islandwide occupancy of 88 per cent. Republic Plaza, its Grade A office building in Raffles Place, is 95 per cent occupied and saw positive rental reversion in Q1 2022, CDL said.
Committed occupancy of the group's retail portfolio is at 95 per cent, above the islandwide occupancy of 92 per cent. Its flagship mall, City Square Mall, is 97 per cent occupied, while at Palais Renaissance, committed occupancy reached 99 per cent.
In March, the group completed a $315 million acquisition of Central Square, which is to be redeveloped alongside CDL's Central Mall properties into a mixed-use development. "Through the URA Strategic Development Incentive Scheme, the redevelopment could potentially yield a significant GFA uplift," CDL said.
Divestments completed during the quarter include Tanglin Shopping Centre, which was sold for $868 million. The group also recognised a total gain of $526.2 million net of taxes and related transaction costs on Millennium Hilton Seoul and its adjoining land site.
Additionally, CDL holds 6.3 per cent of the total share value and 34.8 per cent of the strata area of Golden Mile Complex, which was sold for $700 million to a consortium comprising Far East Organization, Perennial Holdings and Sino Land.
The group's net gearing ratio as at end-March stood at 53 per cent, after factoring in fair value on investment properties. The group had cash reserves of $3.1 billion and available undrawn committed bank facilities totalling $4.6 billion.