A property development comprising what is anticipated to be Sri Lanka's largest shopping mall will start construction later this year, according to Singaporean property tycoon S.P. Tao, the non-executive Chairman of Overseas Realty, the property's developer.
Quoted in Overseas Realty's 2011 Annual Report, which spanned the 12 months to end-December 2011, Mr. Tao stated that "Havelock City’s commercial mixed use development, which will accommodate Sri Lanka’s largest shopping mall of 560,000 sq ft and two towers of office space of 750,000 sq ft, has received necessary preliminary regulatory approvals and construction is scheduled to begin 3rd quarter 2012". The report also went on to add that this commercial development, which will entail a total of six retail floors, two office towers of 20 floors each, a multiplex cinema and restaurants, would be completed by the beginning of 2016.
Also emerging, 216 out of 225 residential apartments in Havelock City's phase one were sold, with 25% more pre-sold out of the 218 units making up the project's phase two, which is scheduled for completion in early 2014. This is with a further 85 perches of land adjacent to the current development also being acquired in 2011 to "pursue other options of development to complement the total project".
Mr. Tao also indicated that the Overseas Realty group had recorded "Profit after Tax (excluding fair value gains) of Rs. 584 million, a 32% increase compared to the previous year. The concomitant increase in demand for quality office space in the World Trade Centre Colombo and residential apartments in Havelock City enabled the Group to record a Gross Revenue of Rs. 2,491 million, an increase of 47% compared to that achieved in 2010".
Further, he attributed this uptake mainly to "[significant] twin increases in occupancy (89% achieved in December 2011) and average rental rates in WTC Colombo contributed to a strong performance for the Company". Office rental generated Rs. 847 million in revenues, which was a 21% year-on-year increase. Also, the report noted that, while occupancy at the start of 2011 was only 72%, a 90% occupancy level was expected over 2012.
However, Mr. Tao also revealed; "Group profit was affected by an exchange loss of Rs. 39.8 million consequent on the depreciation of the Sri Lanka Rupee (SLR) in 2011 compared with an exchange gain of Rs. 83.7 million in 2010. Due to further depreciation of the SLR in the 1st quarter of 2012, foreign exchange risk will have to be carefully monitored and managed".