Henderson Land

Developer's project launches get put on the fast track

PUBLISHED : Thursday, 01 June, 2006, 12:00am
UPDATED : Thursday, 01 June, 2006, 12:00am

Henderson Land Development plans to speed up project launches in the second half of this year after an almost eight-month absence from property sales.

Henderson Land, Hong Kong's third-largest property developer, plans to launch a 95-unit residential project, CentrePlace, at No 1 High Street, Mid-Levels West, shortly.

The developer's unit sales this year would not be less than those of last year, Henderson Land sales general manager Tony Tse Wai-chuen said. The company earlier set a sales target of 3,000 units for the year. 'We will accelerate the sale of new projects in the second half of this year,' he said.

Hong Kong's developers have been slow in launching new projects and selling flats amid rising interest rates.

Overall property sales shrank further to 20 units over the past weekend, against 70 units sold in the previous week.

JP Morgan analyst Raymond Ngai said the slowdown was due to a weakening of buying sentiment amid a slumping stock market and price cuts in the secondary market.

Henderson Land would meet earnings forecasts for the year to June 30, if it brought forward the planned completion next year of CentreStage at Hollywood Road, Mr Ngai said.

Under Hong Kong's accounting rules, developers can only book sales as earnings after the flats are completed.

'Slow development sales are the leading negative contributing factor to net asset value growth which would largely offset the positive impact of the forthcoming [Sunlight reit listing by Henderson],' Mr Ngai said.

Henderson Land sold 10 units at its Grand Promenade project in Sai Wan Ho yesterday, after putting 18 units up for sale at an average of $7,200 per square foot on Sunday.

The developer still has unsold inventory of about 1,000 units, half of which are at the Grand Promenade.

Mr Tse said developers would not price their flats as aggressively as last year, since potential homebuyers were concerned about rising interest rates.

'We will upgrade our project quality to entice sales,' he said, adding that the construction cost of CentrePlace was $1,500 per square foot.