Property developer UOL Group has reported a 55 percent drop-off in net profit to S$68.8 million in the second quarter ended 30 June 2016, due mostly to fair value losses on investment properties.
But group sales in Q2 grew by six percent to S$363.6 million from a year ago, due mainly to higher progressive revenue recognition from residential projects under development, such as Riverbank@Fernvale, Seventy Saint Patrick’s, Botanique at Bartley, and Principal Garden – which was found in 2015 and the upcoming new launch, The Clement Canopy @ Clementi Ave 1
Especially, property development revenue was up 14 percent to S$185.5 million in the quarter.
Meanwhile, UOL stays cautious on the outlook for the housing marketplace. In a statement, Deputy Group CEO Liam Wee Sin said: “Most of our residential projects have achieved comparatively great take up rate due to our strong product aspects. But with the intense rivalry and lack of confirmed sites in the government property sales, our concern is that property prices will be driven to an unhealthy amount.”
At the exact same time, UOL expects office leases to be under pressure from a big supply in the second half of the year. Additionally, it sees retail rents being buffeted by poor retail sales and increased competition.