PETALING JAYA: Paramount Corp Bhd expects current vaccination efforts to normalise economic conditions in 2022 and for the property developer to reach RM1 billion sales again, according to its group CEO Jeffrey Chew Sun Teong.
In 2020, he said, there were still some property buyers in the market and in the following year people bought less property.
“Over time, as people carry on with their lives, the property sector will improve in 2022.”
To put it into perspective, Chew highlighted that prior to the Covid-19 outbreak, the group set a sales target of RM1 billion, which has been disrupted by the pandemic in 2020 and 2021.
“For us, we still believe that in 2022-2023, we can move from RM700-800 million to reach the RM1 billion mark,” he told the media during Paramount’s first-half 2021 results virtual briefing today.
As of Sept 5, 2021, Malaysia’s vaccinated population stands over 48%.
The group CEO elaborated that he had pinned hopes on vaccination protecting people from being adversely affected by the coronavirus, translating into normalising conditions in which people would consider buying properties.
Reflecting the group’s optimism, he pointed out, Paramount has acquired RM350 million worth of land in Sungai Petani, Kedah; Cyberjaya, Selangor; and Kuala Lumpur over the past 18 months to add to its landbank.
In the group’s five-year plan, it has identified the need to purchase RM500 million worth of land to replenish its landbank, and the onset of the pandemic, which coincided with the first year of the plan, presented an opportunity for it to upfront the acquisitions.
Chew said it opted to upfront the purchases as land prices are becoming more reasonable because of the pandemic and decided to seize the opportunity rather than wait. In addition, the lower interest rate environment has made it more attractive.
Moving forward, he noted that the group is still in the market to purchase RM150-200 million more of land but it is not in any rush to do so.
As for its short-term outlook, Chew sees FY2021 as a damper year due to the prolonged pandemic and the ensuing lockdown.
In July, five of its project sites had to suspend work due to the enhanced movement control order in certain localities in Selangor. Furthermore, some of its sites had detected Covid-19 infections resulting in a shutdown to conduct testing of its workers.
“It took some time to get operations at these affected sites up and running again every time they are shut down, although, as of today, all of its construction sites are in operation,” he said.
Chew disclosed that its construction work is roughly operating at 60% capacity and estimates it could return to 100% capacity by the end of this month. Nonetheless, a return to full capacity will not be an easy task given the large and diversified nature of the industry’s supply chain.
The group stressed it has taken measures to meet all the standards set by the government, especially the efforts to inoculate its worforce.