KUALA LUMPUR: Builder and property developer SBC Corp Bhd, which is controlled by the Sia family, is set to launch five developments with a combined gross development value (GDV) of RM750 million over the next 12 months, said its managing director Sia Teong Heng.

These projects will boost SBC’s GDV to RM6.2 billion over the next five to 10 years, from RM4.8 billion currently.

Of the new projects, RM400 million worth of GDV will be located in Sabah and the remaining RM350 million in the Klang Valley.

SBC managing director Sia Teong Heng said unbilled sales stood at RM200 million, which will provide the group with at least two years of earnings visibility. He said the first project to be launched will be a high-end residential area in Kuala Lumpur, which is expected to fetch a GDV of RM150 million. Next is a mixed development project in the foothills of Genting Highlands — called Genting Hill — with an estimated GDV of RM100 million.

“As for others, we will make official announcements in due course but there is definitely something exciting in the market,” he told reporters after the group annual general meeting yesterday.

SBC has a total land bank of 1,098.2 acres (444.43ha), with projects in Kuala Lumpur, Selangor, Kota Kinabalu and Kuantan.

In May last year, SBC entered into a joint venture agreement with Sabah-based Suria Capital Holdings Bhd to develop some 16.25 acres of coastal land in Kota Kinabalu, with a GDV of RM1.8 billion. Dubbed Jesselton Quay, the project will be Sabah’s only integrated waterfront, with full support from the state government.

Under the arrangement, SBC will pay Suria Capital 18% of the project’s total GDV or no less than RM324 million over the next eight years, which translates into land cost of RM460 per sq ft. Sia said the take-up rate for all its developments is generally well above 60%, with some reaching 85%.

On its outlook for the year, Sia said that SBC will continue to maintain its growth momentum for the financial year ending March 31, 2015 (FY15), driven by its projects in the Klang Valley.

“We expect to post good financial results in FY15, the bulk of it will be contributed by our projects in Kuala Lumpur. Likewise, we expect our projects in Kota Kinabalu to contribute positively to our earnings,” he said.

In FY14, SBC saw its net profit jump 19% to RM33.29 million from RM28.02 million a year ago, on improved construction and property development businesses, while revenue increased 10% to RM139 million from RM126.03 million.
 

This article first appeared in The Edge Financial Daily, on October 1, 2014.