Pacific Star Development eyeing regional projects

Pacific Star Development chief executive Glen Chan says most of their upcoming projects will be joint ventures, to ensure the firm is not overstretched.
Pacific Star Development chief executive Glen Chan says most of their upcoming projects will be joint ventures, to ensure the firm is not overstretched.ST PHOTO: LAU FOOK KONG

Reverse takeover a 'complete transformation' that will create value for shareholders: CEO

Newly listed property developer Pacific Star Development is off to a solid start.

The firm is achieving a strong level of take-up for its flagship real estate project in the Iskandar region, while it prepares another project in Bangkok for launch next month.

The company made its debut on the Singapore Exchange's Catalist board last Thursday, following a reverse takeover (RTO) by LH Group.

In an RTO, a listed acquirer often in need of a new business will issue shares to the target - usually a private firm looking to go public - which will in turn assume control of the merged entity.

Pacific Star Development shares have weakened from their debut price of 33 cents, to close at 26.5 cents yesterday.

But chief executive Glen Chan hailed the RTO as a "complete transformation" that will create value for all shareholders, including LH Group which suffered a $5.8 million full-year net loss in 2015. The merged company would have notched up a $4.6 million profit for the first six months last year, according to estimates in the RTO circular.

MAJOR DEVELOPER

I want us to be known as one of Asean's major property developers, with a focus on mixed-use lifestyle projects and retirement resorts that cater to the rising people flow and growing middle class in the region.

MR GLEN CHAN, Pacific Star Development's chief executive.

Pacific Star Development used to be part of the Pacific Star Group, a major property player with investment funds and real estate holdings across Asia, including Singapore's Ngee Ann City and Wisma Atria.

The company now has two projects in hand. Its main source of operating revenue comes from the Puteri Cove Residences, a 1,054-unit bay front project beside Iskandar's Puteri Harbour.

"Of the project's three main towers, one has been converted into a serviced apartment block managed by Pan Pacific. For the other two towers, we have sold 63 per cent of the units," Mr Chan told The Straits Times. "We expect to complete the project in the third quarter this year, and to sell all remaining units by the end of this year."

Mr Chan shrugged off suggestions of a property supply glut in the Iskandar region, noting Puteri Cove Residences' prime location.

"I understand bilateral talks are ongoing to establish a ferry service linking Puteri Harbour with Singapore's HarbourFront, potentially within this year," he added.

"The attractiveness (of the project) is reflected by our price of RM1,400 (S$446) per square foot, compared with the RM1,000 average elsewhere in the Iskandar."

Pacific Star Development's second project is The Posh Twelve in Bangkok. It will be officially launched next month, with completion expected in the second quarter of 2019. Some 20 per cent of the units in one of its two towers have been sold.

Meanwhile, the search for new project opportunities has started.

Said Mr Chan: "We're looking at another potential site in the Iskandar region, also near the Puteri Harbour and it will likely be bigger than the Puteri Cove Residences. By the end of next year, we hope to launch four more projects, in Malaysia, Thailand and Indonesia."

Most of the upcoming projects will be joint ventures, to ensure Pacific Star Development is not overstretched. Mr Chan added: "I want us to be known as one of Asean's major property developers, with a focus on mixed-use lifestyle projects and retirement resorts that cater to the rising people flow and growing middle class in the region."

A version of this article appeared in the print edition of The Straits Times on February 22, 2017, with the headline 'Pacific Star Development eyeing regional projects'. Print Edition | Subscribe