The Edge, KUALA LUMPUR, 21 APRIL 2020 Report : In March 2020, Country Garden Real Estate (CGRE) successfully issued 3 tranches of Islamic Sukuk totalling MYR495 million with the longest tenure being 7 years, despite the downcycle of global market and recent chaos in financial market due to the COVID-19 outbreak. These issuances fully reflect the confidence that Malaysian capital markets have in both Country Garden Group (“the Group”) and CGRE’s long term development in Malaysia. In addition, RAM Ratings had in Sep 2019 reaffirmed the AA3/Stable rating of CGRE’s Islamic Medium-Term Note (IMTN) Programme.
Malaysia is one of the biggest Islamic financing markets in the world today. The Malaysian government has been actively promoting development of Islamic financing and strives to become global center for Islamic financing. A sukuk is an Islamic financial certificate (similar to a bond), that complies with Islamic religious law commonly known as Syariah. Sukuks have become extremely popular since 2000, when the first sukuk was issued by Malaysia.
CGRE’s IMTN Programme was set up in 2015, which was first ever Ringgit Sukuk issued by a China-related corporate entity. It was bestowed the Triple A Islamic Finance Awards 2016 by The Asset and the League Awards 2016 by RAM.
Malaysia has been a strategic investment market for the Group, which currently has 5 projects launched — 2 projects in the Klang Valley and 3 projects in Johor.
Diamond City, located in Semenyih in the state of Selangor, is a development near Nottingham University, Malaysia. Diamond City is Malaysia’s first Spanish-style landed housing, and includes Bungalows, Linked Houses, Semi-Ds and Terrace Houses. At this juncture, six phases have been completed with the remaining three phases currently under planning and construction.
Another project, named Lake City, was recently launched in 2019. Lake City is jointly developed with a renown local developer. Sales has been encouraging despite the recent property market downcycle.
Located in the city of Johor Bahru, Country Garden Danga Bay was completed in 2017, with the Beletime shopping mall – the Group’s very first shopping mall operating overseas — opening to public in 2019. Central Park is another high-rise project in Johor targeting local buyers. Phase 1 was completed in 2019 and is currently in the process of VP.
Forest City, which is located adjacent to Singapore and situated in the Iskandar Special Zone of Johor, is currently the Group’s largest overseas project. Forest City is a long-term sustainable development project, to date, the basic infrastructure of the city has been developed in scales. The company is now focusing on the industrial development of the region and actively carrying out urban operations. Moving forward, Forest City will continue its focus on sustainability, create greater economic vitality for the region, enhance regional value, and introduce industries to create a stable and healthy development ecology for the city. This year, it will continue the investment to promote industrial development, and strengthen cooperation with education and scientific research institutions. The introduction of large scale high-tech and scientific research institutions will bring up the sustainable development potential of the city.
To date, Forest City has completed and is operating two hotels, a Commercial Street, a Water Theme Park, the American Shattuck St Mary International School, an Industrial Building System (IBS) factory and two 18-hole international golf courses. The IBS plant, recorded in Malaysian Book of Records as the largest automated IBS factory in Malaysia, enables technology and skill transfer from various countries, thus benefiting Malaysia.
Forest City has won many awards and recognitions and has been a good corporate citizen to promote the economic development of Malaysia. In 2019, Forest City was granted the CSR award by former Prime Minister of Malaysia Tun Dr. Mahathir Mohamad and has also been awarded the National Community Contribution to Strategic Friendship and Collaboration for its PPR projects and past CSR contributions to the community.
Country Garden Malaysia has strong cashflow with a healthy balance sheet. Sales remained resilient across all projects. This is in line with the Group’s recent announcement that its financial performance in 2019，which was quite encouraging. In 2019, the Group (including joint ventures and associates) achieved contracted sales attributable to shareholders of CNY552.2 billion, which represents a year-on-year increase of 10.03%. The Group’s total revenue rose by 28.2% YoY to CNY485.91 billion and core net profit attributable to company owners was CNY 40.12 billion increased by 17.6%; the Group’s available cash rose to a historic high of CNY 268.35 billion. Moving forward, the Group will continue to explore more investment opportunities in Malaysia.