PACRA Assigns Preliminary Rating to TPL Properties Limited Following Business Model Re-strategization

Lahore, TPL Properties Ltd, having established its mark in the real estate sector for over a decade, is revisiting its business approach after selling its inaugural project, “Centrepoint.” The company’s refocused direction has led to its transformation into a holding entity, owning subsidiaries such as the REIT Management Company, TPL Developments (Pvt.) Limited, TPL Property Management, and a significant stake in the TPL REIT Fund I.

According to a news release by PACRA, post the divestiture of “Centrepoint”, the company transitioned from a singular revenue stream derived from rental income. It’s noteworthy that projects including “One Hoshang,” “Technology Park,” and “Mangrove” have now been assimilated into the TPL REIT Fund I. This move has also facilitated TPL Properties to recognize considerable capital gains. By the end of FY23, construction at “One Hoshang” kick-started, with its official launch planned for 2QFY24. Although the “Mangrove project” has obtained master plan approval, considerations to discontinue the “Technology Park” project are underway due to prevailing macro-economic conditions and dwindling investor enthusiasm. The potential capital gains from the land sale are being explored as an alternative. During FY23, the company reported revenues of PKR 5.3 billion, reflecting a revaluation gain from property transfers to REIT Fund I. Meanwhile, the company’s equity base experienced growth, reaching PKR 13.7 billion, up from PKR 10.5 billion in FY22.

The ratings are closely tied to the management’s effectiveness in guaranteeing cash flow adequacy through the punctual execution of their project construction plans. Any substantial shift in strategy that adversely affects the company’s risk profile could negatively impact the ratings.

The post PACRA Assigns Preliminary Rating to TPL Properties Limited Following Business Model Re-strategization appeared first on Pakistan Business News.