JTC selling small factories to focus on bigger projects

July 30, 2008
JTC selling small factories to focus on bigger projects
By Joyce Teo, Property Correspondent

INDUSTRIAL landlord JTC Corp aims to sell more of its small factories
and other industrial space this financial year as it shifts its focus
to bigger industrial developments.

In late April, JTC sold $1.71 billion of properties to Mapletree
Investments after ditching a plan to roll these assets into a real
estate investment trust (Reit).

The upcoming sales will be on a smaller scale than the April sale,
said JTC chief executive Ow Foong Pheng. She told reporters yesterday
that it is considering the sale of 'a handful' of properties via
tender this financial year.

The properties involved were deemed unsuitable for the proposed Reit.
JTC scrapped that plan to list its high-rise, ready-built assets due
to volatile market conditions. Instead, it sold 62 of these
properties to Mapletree.

JTC is selling its ready- built assets in order to focus on strategic
industrial developments that are too big and risky for the private
sector.

These include Jurong Island and Tuas Biomedical Park, which attracted
about US$8.8 billion (S$12 billion) worth of investments from players
such as ExxonMobil, Lonza and Novartis in the last financial year.

At a press conference yesterday, Mrs Ow said JTC will still look at
the possibility of privatising its subsidiaries Ascendas and Jurong
International Holdings.

She said JTC's performance this financial year is expected to be
slower in line with the softening economic outlook. 'For the
financial years 2008 and 2009, we will not repeat the sterling
performance in the 2007 financial year,' said Mrs Ow.

JTC has already reaped the results of Singapore's strong economic
growth and a buoyant industrial space market in the past two years.

Releasing its latest financial results, JTC yesterday said its total
surplus reached $1.18 billion for the year ended March 31, up a hefty
50 per cent from the previous year.

Its building and land income rose by 5 per cent to $1.1 billion.

Net take-up for its ready-built space reached a new record of 246,300
sq m while the industrial land segment registered a new record net
take-up of 360 ha, the highest level in a decade.