PROPERTY: Myanmar – Yoma Land to focus on property development, expand into mass market
Cyrus Pun, managing director of newly launched Yoma Land, is expanding beyond high-end, luxury properties into the mass market in a bid to promote home ownership and grow in Myanmar.
Yoma Strategic Holdings and First Myanmar Investments Co (FMI) yesterday announced the launch of Yoma Land, which will hold all the real estate assets of both companies from now on.
The new business arm will represent a new division under Yoma Strategic and hold Pun Hlaing Estate, StarCity, Yoma Central and The Peninsula Residences Yangon under its umbrella.
“We have combined our real estate projects under one brand, which we hope will help customers identify us as a serious real estate developer,” Mr Pun told the media.
With the launch of Yoma Land, Mr Pun also revealed that the firm’s aim will now be on promoting home ownership in fast-growing Myanmar by expanding into mass market property.
“Our growth plan going forward will involve expanding into the mass market segment, which also includes developing low-cost housing projects,” he said. By doing so, the company will also gain access to a much larger proportion of the Myanmar population.
Mass market push
Yoma Land’s push into the mass market will be backed by its connection to Yoma Bank and other private banks in the country. Yoma Bank is controlled by FMI, which is the sister company of Yoma Strategic. This will enable Yoma Land to work closely with the banks in bringing a larger pool of financing options to potential home buyers, helping them to better afford new homes.
Currently, the standard home loan arrangement in Myanmar involves a 30 percent downpayment and seven years to repay the remaining 70pc of the loan taken. Meanwhile, bank lending rates range between the Central Bank rate of 10pc and the maximum bank lending rate of 13pc.
“By collaborating with Yoma Bank, we will be able to explore options of reducing the downpayment requirement and expanding the repayment term to 25 years to make houses more affordable for the people of Myanmar,” said Mr Pun.
He added that Yoma Land’s aim of bringing cheaper financing options to home buyers does not require any change in current Central Bank regulations, under which interest rates in the country must be higher than inflation.
All segments covered
Yoma Land’s push into the mass market, which could commence later in the year, comes after units of The Peninsula Residences Yangon went on sale in March. The luxury project is being developed on a 10-acre site in downtown Yangon at the junction of Sule Pagoda Road and Bogyoke Aung San Road. It is part of the $700 million Yoma Central mixed development project, which broke ground in February last year.
The Peninsula Residences Yangon, which will include 96 residential units, is expected to be complete in 2021.
The move will also position the company as a property developer across each segment of the property market, from luxury units at The Peninsular Residences Yangon, upscale townhouses and condominium units at Pun Hlaing Estate and StarCity to low cost housing projects in the future, Mr Pun said.
Yoma Strategic is listed in Singapore and also runs businesses in the consumer and vehicle transport sectors. Shares of the company closed yesterday at 37.5 Singapore cents each, which is down by almost 28pc since the start of the year. / 27 JUN 2018
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