Central aims for eight new centres

The company has also set aside a budget of up to Bt1 billion to renovate CentralPlaza Lat Phrao if the government decides to renew the contract with the group this year, the company's president and CEO Kobchai Chirathivat said yesterday.

The company will also adjust rental prices by between 5 and 10 per cent this year to drive its revenue growth by up to 20 per cent, he said.

Central Pattana announced revenue of Bt2.3 billion and net profit of Bt617.38 million for the first quarter, up 15 per cent and 48 per cent respectively from the same period last year.

CPN signed a long lease with the Crown Property Bureau to develop Suan Lum Night Bazaar last year, but the company cannot start the project as existing businesses there have been unwilling to vacate the land.

However, Kobchai said the bureau believed that the businesses would move and the land could be handed to Central Pattana at the end of the year. As a result, the company is ready to start construction of the complex then.

The project will combine a department store, office building and luxury hotel worth up to Bt10 billion. If construction starts at the end of the year it will be complete during 2010. This is part of an investment budget totalling Bt18 billion for this year through 2010, Kobchai added.

Central Pattana plans to open eight shopping centres by the end of 2010, increasing the number to 18.

Six of the eight will be CentralPlaza Chaeng Wattana, CentralFestival Pattaya Beach, CentralPlaza Chon Buri, CentralPlaza Khon Kaen, CentralPlaza Chiang Mai 2 and the shopping mall at its new complex on the Suan Lum Night Bazaar site.

Earlier, the company's senior executive vice president and chief financial officer Naris Cheyklin said the company was negotiating to take over shopping centres worth more than Bt1 billion in Bangkok and provincial areas this year in order to reach the target of eight new branches by 2010.

Kobchai said the company had signed no such deals to date, but was open to offers.

The company also has a continued interest in expanding overseas, but property prices - especially in China, India and Singapore - are now very high, making such expansion difficult. However, if an opportunity arises, the company is ready, he said.

With aggressive business expansion between until 2010, half the investment budget will come from the company's cash flow, and the rest will be raised through the CPN Retail Growth Property Fund (CPNRF).

Central Pattana is planning to sell CentralPlaza Pinklao and CentralPlaza Chiang Mai to the CPNRF, increasing the value of the property fund from Bt10 billion to Bt20 billion after the sale is concluded in the next quarter.

"With its average yield of 7 per cent a year, we believe our fund will be attractive for both local and foreign investors," Kobchai said.