Gabungan AQRS eyes role in high-impact projects

KUALA LUMPUR: Gabungan AQRS Bhd wants to participate in the high-impact projects recently announced by the government to enhance its order book.

Gabungan AQRS chief executive officer Ng Chun Kooi told The Edge Financial Daily that being a construction player and niche property developer, 2014 looks set to be an eventful year for both of its business segments.

“We recently won an RM173 million project to construct ‘Tropicana Metropark’ in Subang Jaya, which increases our current construction order book to RM1.4 billion.

“This will keep us busy till 2016,” he said in an email interview.

He said that for the construction segment, the government’s recent announcement of major infrastructure and high-impact construction projects such as the new air traffic management centre in KLIA, “park and ride” facilities at LRT, KTM commuter and ERL stations, and the new district police headquarters would open up tender opportunities for construction players.

“We hope that given our track record in the construction industry, we will have the chance to participate in these high-impact projects,” said Ng.  

He said the construction industry currently faces a number of challenges, such as a chronic labour shortage. Other concerns are higher costs of raw materials, electricity tariff and transport.

He said Gabungan AQRS is making good progress in construction of the Klang Valley Mass Rapid Transit (KVMRT) project on the Sungai Buloh to Kota Damansara line.

He said it had passed the 30% completion mark in the third quarter of 2013 (3Q13), adding that it is on track to deliver the work package in mid-2016.

Ng said that on the property development side, there had been commendable take-up rates for the company’s projects, with more than 35% and 55% take-up for “The Peak” and  “Permas Centro” respectively, and more than 75% take-up for “The Avenue @ Kinrara Uptown” in the Klang Valley.

“Encouraged by the response to our projects, we look forward to launch more niche property projects located at strategic areas of the Klang Valley this year,” he said.

Meanwhile, the cooling measures on property prices introduced in Budget 2014 will likely result in many property buyers becoming more selective in their purchases in the early part of 2014, he said.

“We are hopeful that buyer sentiment will improve in the second half of 2014, particularly for projects that have a strong value proposition and fundamental capital appreciation prospects,” said Ng.

On the recent increases in electricity tariffs and fuel price, Ng said the hikes would cause a ripple effect across the construction and property development sector.

“While we would have secured the materials required in the foreseeable future for our construction operations, as contractors we will look into negotiating with customers for variation orders where absolutely necessary.

“As for the property segment, it helps that the construction of our projects is undertaken in-house, which also allows us to preserve margins.  We will also work diligently to find areas where costs can be reduced to mitigate this rise,” he said.

This article first appeared in The Edge Financial Daily, on January 06, 2014.


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