GuocoLand Six-Month Profit Jumps 12% as Revenue Soars 61%

GuocoLand posted a 12 percent year-on-year rise in profit to S$66.2 million ($49.4 million) for its fiscal first half as revenue shot up 61 percent to more than S$1 billion.

The SGX-listed property arm of Malaysia’s Hong Leong Group recorded development revenue growth of 67 percent to S$918 million for the six months to December, driven by higher recognised residential sales in Singapore, it said Wednesday in a release.

Revenue from the investment segment climbed 46 percent to S$109.4 million as the company benefited from the progressive commencement of leases at the Guoco Midtown complex in the city-state’s Bugis area and positive rental reversions at Guoco Tower in Tanjong Pagar.

“We turned in a strong performance for the first half of FY2024, despite the ongoing macroeconomic uncertainties,” said CEO Cheng Hsing Yao. “Our results were underpinned by high-quality income generating assets in Singapore, such as the landmark Guoco Tower and Guoco Midtown developments.”

Midtown Leasing Progress

In December, Guoco Midtown reached 92 percent pre-commitment take-up for its 709,000 square feet (65,868 square metres) of net lettable area across the Grade A office tower and recently completed Network Hub, a purpose-built business and social networking club.

Jointly developed by GuocoLand and its parent Guoco Group, controlled by Malaysia’s Quek family, the S$2.4 billion complex connects directly to Bugis MRT interchange station. The first phase, located along Beach Road, comprises the 30-storey office tower, two condominiums, two retail areas and Midtown House, a conserved building formerly known as Beach Road Police Station.

GuocoLand’s total loans and borrowings rose 10 percent during the fiscal first half to S$5.63 billion, mainly due to financing for the 533-unit Lentor Mansion at Lentor Hills estate in northeastern Singapore. The joint venture development with Hong Leong Holdings — controlled by GuocoLand’s Singapore-based cousins in the Kwek family — is expected to launch in the first quarter of this year.

“With about 75 percent of GuocoLand’s assets based in Singapore, borrowings are backed by a resilient portfolio of high-quality investment properties with good operating performance and stable cash flows, as well as development projects with strong sales progress,” the company said. “As the development projects are completed, existing property development loans will be progressively repaid.”

Occupancy Excels

GuocoLand’s commercial assets in Singapore continued to achieve high occupancy rates, healthy weighted average lease expiry and positive rental reversions, according to the developer.

The company reported 98 percent occupancy at its flagship Guoco Tower and at 20 Collyer Quay, while in China the South Tower of Guoco Changfeng City in Shanghai maintained a committed occupancy rate of 95 percent.

“Rental rates were also strong and mainly ranged between S$11 and S$14 per square foot for the premium Grade A offices at Guoco Tower and Guoco Midtown,” GuocoLand said.