KUALA LUMPUR: Sime Darby Property Bhd is hoping 2024 would be more favourable for the property industry compared with 2023, supported by the gradual easing of interest rates in the United States (US) and United Kingdom (UK) as well as a stable labour market.
Its group managing director Datuk Azmir Merican said the easing of interest rates would impact or influence other monetary decisions globally, hence leading to cheaper homes as affordability increases.
"The data that is coming in are telling us that this is expected to happen and this is also favourable for us in the UK where we have property (Battersea Power Station) which is expensive in terms of square feet, given its location in London," he said at the group's financial year (FY) 2023 results virtual media briefing today.
Elaborating on the labour market, Azmir said a stable labour force for the whole year compared with last year would mean that the sector would be able to progress without interruption at sites.
He said, however, that in sustaining the growth it achieved in 2023, one of the challenges is to focus on the investment and asset management segment where it would need to invest in recurring income.
For 2024, the group is targeting RM3.0 billion in sales and launches worth RM3.9 billion in total gross development value (GDV).
He noted that it would have a diversified launch GDV pipeline which consists of 34 per cent industrial, 32 per cent residential landed and 31 per cent residential high-rise.
The group he said is expanding its retail and placemaking components with the quarter two opening of its second wholly owned mall, the Elmina Lakeside Mall in the City of Elmina, Selangor.
"The group is optimistic about growth opportunities in this sector to broaden recurring income streams in the long term," said Azmir.
For the first quarter of FY2024, the group plans to launch 532 units of various products with a GDV worth RM954.1 million.
Meanwhile, the group is also maintaining its targeted gross profit margin this year of between 20 per cent and 25 per cent, considering potential fluctuations in material prices.
As of Dec 31, 2023, the group maintained a strong unbilled sales of RM3.6 billion, providing healthy earning visibility across the next three years.
Additionally, in line with its net zero carbon emission pledge by 2050, he said the group has set a target to reduce emissions by 40 per cent by 2030 for Scope 1 and 2 emissions and will increase engagement with industry associations and supply chains to advocate rapid decarbonisation. - Bernama