HOMERUNPower Moves: CDL Executive Chairman on Life! Power List 2016
BIZBUZZConnectivity @ Work: Distrii to Open in Republic Plaza
LUXESTYLEM&C Named World's 40th Largest Hotel Group
FUTURENOWRamping Up Construction Productivity
HEARTWORKSpace to Grow: Learning Space @ Limbang
LIVELIFEA New Perk in Town for F.R.I.E.N.D.S
World events last year have reminded us yet again that firstly, nothing is ever predictable; secondly, one should never assume nor take things for granted; and thirdly, our response to these changes is even more important than the change itself.
The global economy will need time to grapple with these challenges and uncertainties in the near-term, as both markets and industries continue to adapt to a post-Brexit world and a new US administration. Amidst these headwinds, opportunities await — and economies that are agile will be the most resilient.
Organisations such as CDL must stay nimble and swift to implement innovative strategies outside their traditional playbook. We believe that prudent capital management, strong stewardship, cost control and investment discipline will be key drivers of business success in the new economy.
For over five decades, CDL has built a solid track record in residential property development especially in our home market of Singapore. Despite challenging market conditions, in 2016, CDL, together with our JV associates, sold a total of 1,017 units (including Executive Condominiums), with a sales value of about S$1.25 billion. By comparison, in 2015, we sold 674 units with a sales value of about S$691.5 million. On a consolidated basis, Hong Leong Group emerged as the top developer with the most number of units sold in Singapore for 2016.
Notably, besides clearing our existing inventory, CDL also launched two new residential projects — Gramercy Park and Forest Woods — both of which were well received by the market. The 519-unit Forest Woods, which is a five-minute walk to Nex Shopping Mall and Serangoon MRT interchange and bus interchange in particular, was one of the year's best-selling condominium projects, and is now 74% sold since its launch in October.
Our overseas development projects in China, Australia, Japan and UK also recorded steady sales performance. In particular, the Hong Leong City Center project in Suzhou has sold a total of 1,031 units to date in its Phase 1 launch. Its strong performance will translate into a maiden profit contribution in Q4 2016 results.
Building Collaborative Partnerships
Multi-dimensional disruption is the future of work and to remain relevant, businesses must embrace the spirit of 'creative destruction' and reinvent themselves. At CDL, we are actively seeking strategic investments and partnerships for immediate entry into fast-growing, new economy sectors which complement our business and enhance our recurring income streams.
Last September, we announced our RMB 100 million investment for a 20% stake in mamahome, one of China's fastest growing online apartment rental platforms. Operating under an asset light model with a focus on internet expansion, mamahome represents an efficient manner to grow market share.
More recently, we also announced a RMB 72 million investment for a 24% stake in Distrii, China's leading co-working space operator. Distrii will lease over 60,000 square feet of space at Republic Plaza, CDL's flagship commercial property in the heart of Singapore's Central Business District, for its first international facility. Scheduled to open in 1H 2018, the space is expected to be one of the largest co-working facilities in Singapore, integrating food and beverage, entertainment, recreational and office facilities.
Aside from contributing future long-term recurring income streams, these partnerships offer CDL immediate exposure to business segments with significant potential growth and future synergies. Both the mamahome and Distrii platforms provide scalability and can be effectively applied to our asset portfolio.
Building on Strength
In 2017, we will continue to execute against three strategic objectives.
Firstly, we will actively seek acquisitive opportunities, deploying our war chest while maintaining strict discipline in our investment approach. CDL is currently very well-poised with a strong cash position of over S$3 billion to capitalise on acquisitive opportunities at the right price, especially during this period of market dislocation.
Secondly, we will continue to recalibrate our asset portfolio, enabling us to unlock value with a specific focus on achieving our funds under management objective and enhancing our price-earnings multiple.
Finally, we will retool our organisation towards a performance-driven approach, enhancing both efficiency and effectiveness. In tandem with this, we will implement several initiatives to develop our human capital from Balanced Scorecards to talent management. By broadening our core competencies, this transformative exercise will position us well to achieve our growth targets for Singapore and overseas.
On this note, I would like to express our heartfelt appreciation to you, our valued stakeholders, for your support over the past year. We look forward to blazing new trails with you in this new year ahead!
CDL Chief Executive Officer
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