The country's largest developer Land & Houses Plc (LH), based on an assumption of a 10-15% drop in the property market and a 2% fall in GDP, is to diversify its range of residential units to achieve 1.2% sales growth, said senior executive vice-president Naporn Sunthornchitcharoen.

He predicts a 30% drop in condominiums, a 10% dip in townhouses and a 3-5% fall for single-houses.

This year, LH is aiming for 15.45 billion baht in revenue from sales of 3,288 units - 73% from single houses, 11% from townhouses and 16% from condominiums, he said.

The company plans to invest 3 billion baht in new plots of land, down from 3.75 billion last year. It will spend another 300 million baht in a new mixed-use project on Asoke Intersection, a joint-venture project with Government of Singapore Investment Corp.

He added that the property market this year would be boosted by real demand. Fewer than 70,000 newly registered houses are anticipated, down from a projection of 79,300 units last year.

LH's revenue plunged in January by 25-30% year-on-year but picked up in February. The fourth quarter of 2008 was the company's worst, with revenue down 25% year-on-year, and 20% of its clients had loan applications rejected.

Mr Naporn said negative factors this year include a global recession, a slowdown in private investment and unemployment. Public consumption will decline due to a lack of confidence in future income while banks will be more cautious in lending, he said.

But he anticipated positive factors including a 5-7% drop in construction costs and cheaper oil, lower inflation, interest rates cut by 0.75-1%, steady land prices and government tax incentives.

LH this year plans to launch 12 residential projects worth a total of 16.38 billion baht - 11 projects in Greater Bangkok and one project in Chiang Mai.

The company plans to issue 3 billion baht in three-year-maturity debentures in late 2009 to enhance its liquidity while its current debt of 1.5 billion baht from expired debentures will be repaid by cash from the operation.

LH last year reported consolidated net profit of 3.42 billion baht, up 8.5% from 3.15 billion in 2007, on total revenue of 16 billion baht, down 16% from 2007. It recorded 15.41 billion baht in revenue from housing sales, down 17.4% largely due to weaker demand and more cautious home loan lending by banks.

LH shares closed on the Stock Exchange of Thailand at 2.58 baht, down 12 satang, in total trade of 116 million baht.

source : www.bangkokpost.com