Brem Holdings scaling up its developments, to launch Jalan 222 project
Brem Holdings Bhd is beefing up its property development segment to generate long term sustainable income and part of the plan is to acquire development land in Serendah, Selangor.
The developer said its wholly-owned subsidiary, Brem Construction Sdn Bhd has on October 16, 2020, entered into six sales and purchase agreements (SPAs) with Padang Dinamik Sdn Bhd for the proposed acquisition of six parcels of leasehold vacant industrial land in Serendah.
Brem Construction will acquire a total of 528,439.33 square meters of land for RM68.26 million.
“The proposed acquisitions are in line with the group’s strategy to replenish land bank at locations with strong growth potential,” Brem said in a filing with Bursa Malaysia.
Brem registered revenue of RM11.1 million for the first quarter ended June 30, 2020, which was 74 per cent lower as compared to the preceding year corresponding period of RM42.7 million.
In the same period, the group’s pre-tax profit fell by 70.6 per cent to RM4.9 million against RM16.7 million achieved in the preceding year corresponding period.
Brem said in an August filing with Bursa Malaysia that the drop in both revenues and pre-tax profit was mainly due to the aftermath of the Covid-19 pandemic where the business activities were greatly affected by the Movement Control Order (MCO) imposed by the government.
The property development segment reported 81 per cent lower revenue and 37.1 per cent lower pre-tax profit during the quarter ended June 30, 2020, as compared to the preceding year corresponding period.
The property investment and investment holding segment recorded 38.4 per cent lower revenue and 65.2 per cent lower pre-tax profit during the three months to June 30, 2020, as compared to the preceding year corresponding period.
Brem said the reduction in the property investment and investment holding segment was due to the operation of Brem Mall, a retail-cum-office complex at Jalan Kepong, Kuala Lumpur, that was affected by the MCO.
The developer had offered a rental waiver to eligible tenants to alleviate their financial burden during the MCO period.
Brem is also involved in civil engineering and construction, as well as water supply and services.
On prospects for the property development segment, Brem said it is venturing into other marketing avenues to improve sales.
The developer is also waiting for the right timing and availability of financing to launch its new development project.
Among its current and future projects listed on its website are Harmoni 2 at Bukit Prima Pelangi (Segambut Dalam/North Mont Kiara), Pelangi Heights Phase 2 (Klang), and PJ Brem City (Petaling Jaya).
Brem owns 9.3 acres of prime land located along Jalan 222 in Petaling Jaya, which it acquired for RM48 million in 2011.
The developer has preserved the land for a mixed development comprising residential, retails, offices and business centre.
For Brem Mall, the group expects it to face downward pressure on occupancy rate and teething collection issues from tenants post Covid-19 pandemic.
“The Board is cautious about the current market sentiment and will continue to seek ways and implement measures to improve the financial performance for the financial period ending March 31, 2021,” it said.
Source: NST