City Developments profits up 12.2% in FY14

Boosted by its Sentosa Cove Quayside Collection divestment.

City Developments saw an active 2014 in terms of cashflow.

According to a report by OSK-DMG, City Developments (CDL) reported FY14 PATMI of SGD769.6m, up 12.2%. This increase was primarily due to the completion of the sale of the cashflows of Cityview, which owns the W Singapore, Quayside Isle and The Residences at W Singapore. Maiden contribution from D’Nest and Jewel@Buangkok and the entire profit from Blossom Residences EC (TOP: 3Q14) also contributed to the increase.

CDL sold 1,378 units (incl. ECs) (2013: 3,210 units) at SGD1.4b in 2014, maintaining its position as Singapore’s top-selling private sector developer. No profit was realised from Coco Palms and Commonwealth Towers yet. According to the Urban Redevelopment Authority (URA), the ASPs for Coco Palms and Commonwealth Towers were SGD1,003/SGD1,618psf respectively (see Figures 1-2), with smaller units on average being sold at the higher prices.

The first tenant is expected to commence business in 1Q15. Reported tenants including Facebook, Sanofi, Rabobank, Bain & Company, TMF Group and Boeing. South Beach Consortium is currently in advanced negotiations with potential tenants to take up the remaining 20%. TOP is expected in 1Q15 with average passing rents at SGD10psf/mth. The Hotel South Beach is expected to soft open in Apr 2015 while the South Beach Residences is expected to be completed during 4Q15.

OSK-DMG expects t it will take some time before CDL’s overseas residential projects start to contribute to earnings. In China, CDL is still pending the launch of Eling Residences (soft launch 2Q15) and Suzhou HLCC, dependent on market conditions. CDL expects FY15 CAPEX of SGD1.0b vis-à-vis SGD1.3b last year.