KUALA LUMPUR: Tanco Holdings Bhd will focus on developing its Palm Springs Resort City project, which has a gross development value (GDV) of RM5 billion, in Port Dickson, Negeri Sembilan for its financial year ended June 30, 2015 (FY15).

“The project includes Splash Park, which is a water theme park expected to be completed by the third quarter next year, 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) yesterday.

He said the theme park is being constructed by Australian integrated thematic construction company Sanderson Group.

The property developer’s financials has been in the red for the past two 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 RM29.2million 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 shrank to RM612,000, down 35.92% .

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 meet the demand], therefore we believe this (the theme park) will encourage suite occupancy, and kick-start our Palm Spring Resort project,” said Chan.

He said the take-up rate for Splash Park Suites towers is now 80% for the first block and that plans are on the way to launch the second block soon. Tanco expects the whole project to be completed within the next 10 years or less.

This article first appeared in The Edge Financial Daily, on December 11, 2014.