‘Not meaningful’ for Pacific Star Development to resume trading, board says

CATALIST-listed property developer Pacific Star Development will not seek to resume trading of its shares yet as its board believes it is “not meaningful” to do so now. Trading of the company’s shares has been suspended since Mar 24, 2020.

In its response on Thursday (Dec 29) to queries from Securities Investors Association (Singapore) on Dec 23, Pacific Star Development said that its board views that it is not meaningful to submit a resumption of trading proposal until the group is able to complete the bulk sale of unsold units at Puteri Cove Residences and Quayside (PCR), and to determine the group’s future growth prospects.

The developments are in Iskandar Puteri, Johor, a short drive away from Singapore. The area has drawn media attention after it turned into somewhat of a ghost town despite being over-developed. It was shunned by locals because of the high house prices there, and excessive focus on foreign buyers.

In response to why its management is projecting that the potential bulk sale will take another 11 to 12 months to complete, the company said: “Despite the group’s best efforts, the fruition of these (discussions with potential buyers) is uncertain and not within the control of the group.”

These potential buyers are identified through its existing network of contacts, it added.

Nevertheless, it said the price trend for PCR has been improving since the lifting of border restrictions in Malaysia earlier this year. 

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Management’s strategy, it added, is to maintain and enhance the value of unsold units as best as possible, while evaluating viable deals – whether they are bulk sales, an en-bloc sale or sale of individual units.

It also said its strategy was “never to compete based on price”, although it is aware that cash-strapped developers of surrounding projects have slashed prices in their efforts to sell inventory to generate cash flow.

Stating that PCR is “the best real estate product in the Iskandar Puteri area” in its opinion, the group said: “Management has been selective in engaging with potential buyers, and does not entertain all deals that are placed on the table ... Lowball offers are rejected outright.

“Instead, management seeks to pursue and structure deals which reflect the quality of PCR, and which are financially and commercially reasonable for the group and its stakeholders.”

The group, however, declined to disclose the number of unsold units due to “commercial reasons”.

Pacific Star Development is now working on providing further details and clarifications to Singapore Exchange Regulation on its decision to seek a further extension, to Dec 31, 2023, for the submission of a resumption of trading proposal, it said.