KUALA LUMPUR (Dec 10): Tanco Holdings Bhd plans to concentrate its efforts in the financial year ending June 30, 2015 (FY15) on developing Palm Springs Resort City, its RM5 billion gross development value (GDV) project in Port Dickson, Negeri Sembilan.

“Our Palm Springs project includes Splash Park, which is a water theme park expected to be completed by the third quarter next year [2015], and Splash Park Suites towers, which are serviced suits managed by Impiana Hotels and Resorts Management Sdn Bhd,” Tanco executive director Andrew Tan Jun Suan told The Edge Financial Daily, after the group’s annual general meeting (AGM) today.

He said the theme park is being constructed by Australian integrated thematic construction company, Sanderson Group, which had recently partnered Perak Corp Bhd for the RM450 million Movie Animation Park Studios in Meru Raya, Perak.

The property developer’s financials has been in the red for the past 2 years, recording a net loss of RM83.18 million, on the back of revenue of RM30 million for its financial year ended June 30, 2013 (FY13); and a net loss of RM29.2 million, on the back of revenue of RM8.81 million in FY14.

It continued its losing streak in its first quarter ended Sept 30, 2014 (1QFY15), with net loss widening to RM4.86 million, compared with 1QFY14’s RM3.16 million. Revenue also further shrunk to RM612,000, down 35.92% from RM955,000 in the same period.

The group had previously said its loss-making position, particularly in FY14, was due to its decision to terminate and dissolve the Vacation Superclub (VSC) — a 30-year timeshare membership programme operated by the group. The termination resulted in Tanco having to pay RM15 million to eligible VSC members, for the remainder of their unutilised vacation points.

Going forward, Tan is upbeat on the group’s focus on the Palm Springs project.

Another Tanco executive director, Chan Chee Meng, said construction of the theme park is to improve occupancy rates at the Splash Park Suites.

“As Port Dickson is a popular spot during school holidays and public holidays, there are not enough rooms [to accommodate the demand]; therefore we believe this [the theme park] will encourage suite occupancy, and kickstart our Palm Spring Resort project,” said Chan.

He said the take-up rate for Splash Park Suites towers is now at 80% for the first block, and that plans are on the way to launch the second block soon.

“Sales have been very encouraging, unlike other property developments out there, ours are more lifestyle intensive. Location-wise, due to ample tourists who visit Port Dickson, and with our additional attractions of a theme park, spa, retirement village and an international hotel in the pipeline for Palm Springs, we are confident our suites will [do well],” said Chan.

On the time frame for the completion of the whole development, Chan said Tanco expects it to be within the next 10 years or less — depending on the take-up rate of the suites.

The group also has 170 acres of land in Lake Kenyir, Terengganu, which it plans to develop into tourism-related products in the near future.

As at 4pm, Tanco’s counter was unchanged at 13.5 sen, giving it a market capitalisation of RM45.21 million.