Strategic Sale in the Property Realm
In a notable development in the property sector, Tropicana Macalister Avenue (Penang) Sdn Bhd, a subsidiary wholly owned by Tropicana Corporation Berhad, has entered into a pivotal agreement. The company has finalized a sale and purchase agreement (SPA) with IOI PFCC Hotel Sdn Bhd, a subsidiary indirectly linked to IOI Properties Group Berhad (IOIPG). This agreement involves the significant sale of Courtyard by Marriott Penang, a deal valued at a substantial RM165 million.
Financial Repercussions and Strategic Advantages
This transaction, a result of mutual agreement between willing parties, represents more than just a financial exchange. It is anticipated to bring about a surplus of approximately RM80.8 million for Tropicana. This surplus is earmarked for strategic use in reducing the company’s existing financial obligations, aligning with Tropicana’s larger goals. These include the monetization of landbanks and investment properties, a reduction in net gearing, and an overall enhancement of the Group’s financial health.
Continued Earnings and Future Outlook
Tropicana is poised to maintain a trajectory of sustained earnings. This positive outlook is supported by RM2.3 billion in unbilled sales, ongoing property sales initiatives, and a robust performance in property sales, which amounted to RM1.4 billion in FY2023. The Group’s management shared their optimism, stating, “Over the past few months, the Group reported a string of positive news, from itssuccessful sukuk redemption, higher revenue jump to multiple award triumphs. We are confident that the Group will continue to strengthen its market presence and contribute to its future earnings supported by high unbilled sales of RM2.3 billion and strong take-up for ongoing projects. Our mission is to transform Tropicana into a future-ready property group with a strong purpose of sustainable growth, centred around our development DNAs and ESG commitments. We have strategic divestment plans that we are confident of achieving and will continue to roll out effective sales campaigns to drive growth, especially emphasising our digital and online initiatives and customer centric engagements.”
Courtyard by Marriott Penang: A Standout Asset
Opened in 2020, Courtyard by Marriott Penang stands as Malaysia’s first in this category. It features 199 hotel rooms and suites, complemented by exceptional hotel amenities. Located in the vibrant heart of Georgetown, Penang, this modern hotel boasts impressive views and consistently high occupancy rates throughout the year.
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Optimism in Property Demand and Forthcoming Projects
Tropicana remains confident in the sustained demand for properties in prime locations. Their well-established and developing townships have demonstrated remarkable take-up rates in various projects. As 2024 unfolds, Tropicana is preparing to unveil signature developments with an estimated GDV exceeding RM4 billion, spread across multiple strategic locations.
Tropicana’s Vast Landbank and Prospective Vision
With an extensive landbank of 1,842 acres and a potential GDV of around RM120 billion, Tropicana is strategically positioned to unlock the value of its landbank. This positions the Group for enduring performance and growth in the upcoming years, heralding a new chapter in property development and financial strategy.
The recent sale of Courtyard by Marriott Penang by Tropicana Macalister Avenue is a testament to the company’s strategic foresight and commitment to sustainable growth. This move not only bolsters Tropicana’s financial standing but also paves the way for future developments and achievements in the property market.
