by Kwek Leng Beng, Chairman of City Developments Ltd., continues speaking during a press conference in Singapore … [+]
City Developments Ltd. (CDL) — controlled by billionaire Kwek Leng Beng — posted its highest-ever net profit in 2022 as its hotels benefited from a recovery in travel demand after the pandemic and the developer posted robust sales for its residential projects in Singapore. that has weathered a global real estate downturn.
The company said net income for 2022 increased to S$1.3 billion (US$971 million) compared to S$84.7 million a year earlier, supported by gains from the Millennium Hilton Seoul divestment and the Sale of interests in two commercial properties in Singapore.
“The Group is pleased to report excellent results for 2022, driven by prudent divestitures and strong operational performance of our core businesses,” CDL chairman Kwek said in a statement. “Our hotel operations have made an excellent recovery, recovering to pre-pandemic levels in most markets.”
Group sales increased by 25% to S$3.3 billion, according to CDL, with residential property sales accounting for 42% of total sales. Best sellers include Copen Grand, a joint venture with Hong Kong land unit MCL Land in Tengah Town, a western Singapore suburb. The project’s 639 residential units were fully sold within a month of its launch in October.
Robust sales in CDL projects are contributing to signs of robust residential demand in Singapore, with buyers undeterred by rising interest rates and rising inflationary pressures, which could plunge the global economy into another recession. House prices in Singapore rose 8.6% in 2022 after rising 10.6% the year before, government data showed.
To fuel Singapore’s resilient housing demand, City Developments plans to launch three projects this year, including the Newport Residences, a 45-story mixed-use commercial and residential development in Tanjong Pagar, on the edge of the Raffles Place CBD. The company will begin marketing the 246 condominiums, including a super penthouse, on the site of the former Fuji Xerox Towers on Anson Road in the first half of this year.
In addition to expanding its Singapore portfolio, City Developments is also looking at opportunities abroad. To that end, the company announced last month that it was in talks to purchase the historic St Katharine Docks residential and commercial complex in London from US private equity giant Blackstone.
City Developments has increased its investments in the UK in recent years, where it owns a portfolio of commercial properties, including an office building which houses HSBC’s London headquarters. It had planned to invest the assets in a real estate mutual fund that was set to list in Singapore, but the IPO was delayed due to heightened market volatility and macro headwinds.
Kwek is the Chairman of CDL and Singapore’s Hong Leong Group, which was founded in 1941 by his father. His cousin Quek Leng Chan, also a billionaire, runs a separate group in Malaysia called Hong Leong. With a net worth of $9.3 billion that he shares with his family, 81-year-old Kwek was ranked fifth on Singapore’s 50 richest list released in September.
