To prepare itself, it is diversifying its income by building homes and providing more services
REAL estate group PropNex is eyeing a listing on the Singapore Exchange (SGX) before 2010.To prepare for the initial public offering (IPO), the firm is diversifying its sources of income by developing homes and providing financial and information technology services.
The seven-year-old real estate group, which touts itself as the largest agency in Singapore in terms of number of agents, aims to lift the proportion of its revenue from non-real estate sources to at least 50 per cent before its planned listing. That is double the proportion now.
This would strengthen its position and make it less dependent on the cyclical real estate sector, PropNex chief executive Mohamed Ismail told The Straits Times yesterday.
He said getting the company listed would allow the firm to reward its senior staff with preferential shares. And it would also help put in place a better corporate structure for PropNex, he added.
The company said it has about 7,000 agents on its roll, of which more than 4,000 actively broker property sales.
Gearing upPropNex aims to life the proportion of its revenue from non-real estate sources to at least 50 per cent before its planned listing, says Mr Mohamed (left).
PropNex recently terminated the contract of one its top division directors, Mr Eric Cheng, as he was 'not aligned' with the firm's values.
This arose out of a disagreement over what Mr Mohamed said is Mr Cheng's group of companies, ECG, getting more prominence than PropNex in its group's publicity material.
Mr Cheng's team of 1,400 agents was one of more than 50 teams under the PropNex banner before his departure.
Mr Mohamed said PropNex's move was not directly linked to its IPO plans, but added: 'If the company's desire is to go for IPO, why do I want to confuse consumers?'
Meanwhile, PropNex has set up SingBuilders, which focuses on small-scale developments. It is building three terrace houses in the Kovan area as well as a bungalow in Sentosa. It also bought a plot of freehold land near Paya Lebar MRT Station for 28 freehold apartments.
Another PropNex venture, SingCapital, was set up in May to provide financial advice to homebuyers. That has generated a net profit of $500,000 since it started operations in May.
PropNex generates an average turnover of $10 million a month. In the first nine months of this year, its turnover hit $90 million.
Within the real estate sector, Hersing - which owns the franchise for brands such as ERA and Coldwell Banker - is also listed on the SGX.
MOVING UP
Getting listed would allow PropNex to reward its senior staff with preferential shares and help put in place a better corporate structure for the real estate company.
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