This article is from the Australian Property Journal archive
Residential property developer Payce Consolidated has blamed approval delays in its Homebush Bay project in Sydney for posting a weaker profit result.
For the year ended June 30, 2006, the company posted a net profit of $2 million – a fall of 82% when compared to $11.7 million in 2005.
Over the 12 months, the company’s revenue fell 53% from $72.8 million to $38.2 million.
Payce said the company’s major source of profit is from the residential development of its landholdings at Homebush Bay.
However, Payce said due to delays in receiving development approvals, constructions commencement of several buildings did not occur when originally planned and consequently this has impacted upon the 2006 financial year.
According to Payce, only one building was completed over the 12 months totalling 76 apartments – of which 71 were settled. This compares to four buildings totalling 145 apartments being completed and settled in 2005.
Payce said as a result of the delay, several projects are now being schedule to complete during the first half of 2007, including the Sorrento comprising 119 apartments, Paros totalling 130 apartments and Valencia totalling 173 apartments.
The company said the three projects will significantly improve its 2007 profits.
Looking ahead, the company said it is looking to reduce its reliance on profits from the development of residential properties by pursuing other initiatives including property management and development services to other companies.
By Kathryn O’Meara
