22-08-2008: Selangor Dredging sees challenging FY09
by Yantoultra Ngui Yichen & Venus Hew

KUALA LUMPUR: Property developer Selangor Dredging Bhd (SDB) expects the remainder of its fiscal year ending March 31, 2009 (FY09) to be a challenging time, given rising development cost and interest rates that dampen demand for property.

“Due to the general slowdown in the economy, we have to be selective as to when to launch. Our immediate launch is in Ampang (by year-end), and by the first quarter of next year, we’ll be launching our next Singapore development in Gilstead,” said its managing director Teh Lip Kim.

Speaking to reporters after its AGM here yesterday, she said the Jalan Ampang project was a luxury low-density condominium comprising 38 units, with a gross development value (GDV) of RM160 million.

The Singapore project in Gilstead Road is a 33-storey condominium with a GDV of RM260 million, Teh said, adding that it would be SDB’s second foray into Singapore after its luxury low-rise development in Wilkie Road which has a GDV of RM155 million.

She also said that SDB needed to be flexible given the slowdown in demand for properties. The company aimed to focus on Singapore and Malaysia as it believed these markets had good potential in terms of stable growth and profitability.

Teh said SDB was assisting its contractors in adjusting to the rising cost of materials and managing the risk of lower operating income. The company would also explore cost control by leveraging on its financial capability.

SDB chairman Eddy Chieng Ing Huong said: “With the economic uncertainties, we remain cautious; however we are opportunistic in attracting discerning buyers as our projects have been well received, plus we are able to sell at respectable prices.”

Describing SDB as a niche quality developer, he said the company was confident the Jalan Ampang project would receive good response.

On three other developments – Taman Melawati phase 2, SS2 phase 2 and Damansara 21 in Damansara Heights – which SDB initially planned to launch this year and next year, Chieng said it would consider the regulatory issues, economic circumstances and cost budget before launching the projects.

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