Despite the slowdown in the property market, EcoFirst Consolidated Bhd targets to boost sales with the launch of its biggest project next month.
Notably, the company will launch residential and commercial units with combined gross development value (GDV) of RM600 million in November, according to group chief executive officer Datuk Tiong Kwing Hee.
It will be part of its RM5 billion project Ampang Ukay, which it is developing for more than 10 years on an 87acre site.
EcoFirst’s largest development project thus far, the Ampang Ukay mixed development project is situated on the outskirt of the Kuala Lumpur city centre, fronting the Ulu Kelang part of the Middle Ring Road II.
Tiong noted that EcoFirst is also involved in the property investment business.
“Our revenue is expected to be better in the financial year ending May 30, 2017 (FY17) on the back of higher rental income from our mall, South City Plaza in Seri Kembangan as well as realising the sales from the first phase of Ampang Ukay development,” he said after the company’s AGM.
Meanwhile, EcoFirst is nearing completion of its Upper East @ Tiger Lane residential project in Ipoh.
With GDV of around RM302 million, the 529-unit project is expected to be completed in February 2017, said Tiong.
During the shareholder’s meeting, EcoFirst also obtained approval to dispose of its 1Segamat Mall in Johor for RM104 million cash to Hektar Real Estate Investment Trust.
The deal is expected to be completed in May next year, the proceeds of which will be used to bring down the gearing of the company.
“We made a strategic decision to sell our investment property, in order to unlock more of the company’s potential…The sales allows us to further strengthen our balance sheet and improve our returns to shareholders by focusing on our Ampang Ukay project,” commented Tiong.
EcoFirst saw its net profit for the financial year ended 31 May 2016 soar to RM16.1 million from RM6.1 million during the previous year, while revenue jumped 49 percent to RM121.2 million.
The company’s topline and bottomline were boosted by its Tiger Lane project in Ipoh.
Moreover, Toing said the company has no plan to sell its South City Plaza mall in Seri Kembangan.
With an occupancy rate of 92 percent, the mall currently contribute around RM12 million revenue a year for EcoFirst.
“South City Plaza is a strata mall, it is not easy to sell and it also provides recurring income to the company,” he said.
“Next year we are targeting the rental income to grow to RM16 million a year on the back of higher tenant rate.”
Tiong also revealed the company’s plan to acquire more land in the Klang Valley.
“Our target now is to buy smaller land that can generate quick cash or a joint venture partnership with land owner,” he said.