Logo of Phnom Penh Post newspaper Phnom Penh Post - Marketing at ‘The Bay’ eats into Teho’s bottom line

Marketing at ‘The Bay’ eats into Teho’s bottom line

Marketing at ‘The Bay’ eats into Teho’s bottom line

Teho International, developer of the $500 million “The Bay” real estate project in Phnom Penh, reported $5.3 million in losses for the year ending June 2015, in part due to marketing and promotional activities relating to the Cambodian project.

In an annual filing to the Singapore Exchange last week, the company said that while its property development segment grew 18.6 per cent to $4.25 million in revenues, its Cambodian foray was yet to register revenues.

“No revenue is recognised as this is in accordance with revenue recognition principles in the financial reporting standards.

The financial reporting standards require the construction to have commenced before any revenue can be recognised,” a company spokesperson said in an email.

The spokesman said that 100 condominiums had been sold during the soft launch.

The first phase of the project will include construction of a 45-storey luxury hotel named the Okura Prestige Phnom Penh and a 53-storey apartment building.

The second and third phase will see five 55-storey apartment buildings, including shopping malls and other entertainment venues.

The company, which launched the project in February of this year, has so far spent $1.9 million on advertising and promotional activities, as well as around $600,000 in legal and professional expenses on The Bay.

“These marketing and promotional activities played an essential role in ensuring the success of the project.

This can be evidenced through the success of the soft launch events, where over 100 condominium units were sold,” the spokesperson added.

According to a note in the report, the Singapore developer, whose Cambodian subsidiary is a 49 per cent partner with the Sok Bun Group, reported that the land for the development was worth $15.3 million and is located in the capital’s Chroy Changvar peninsula.

Sung Bonna, director of Bonna Reality Group, said he had no comment on the sales at The Bay, but that developers used different strategies to selling their units and there was no fixed standard or practice adopted by the sector here.

“It depends on who they are. Some do pre-sales and some will just open to public to know [about the project],” Bonna said.

Apart from property development, which is a recent addition to its portfolio, Teho International also deals in offshore oil and gas, and marine engineering.

MOST VIEWED

  • Serious flooding across country

    The Kampong Speu provincial Committee for Disaster Management on Wednesday issued an alert after non-stop heavy rain caused widespread flooding. In Koh Kong province, authorities are working with the disaster committee and the Cambodian Red Cross to assist those affected after more than 350 homes were

  • CNRP points to King in call for vote boycott

    Leaders of the former Cambodia National Rescue Party (CNRP) have taken a new tack in their call for a boycott of the national elections later this month. They are now claiming that the people should follow the King, who is expected to abide by tradition

  • Actress’s NGO takes heat for promoting the ruling party

    An actress’s NGO which participated in an election campaign event contrary to the Law on Association and Non-Governmental Organisations (Lango) has been slammed. Chorn Chanleakena, a celebrity and the president of the Association of Artists Volunteering to Help Society, allegedly led its members in

  • Troop moves ‘won’t worry people’

    Senior officials at the Ministry of Defence and National Police said on Tuesday that riot training provided to the country’s police forces were aimed at preventing unexpected demonstrations and strikes before and after the July 29 national elections. The troop mobilisation, they said, would not