[ Malaya.com.ph ] July 16, 2008
By ALBERT CASTRO
Ayala Land Inc., the country's largest property developer, is enjoying brisk sales with an average 80 percent take up rate on new projects.
Its high-end project in fact are bought at a faster rate than its middle-range projects, whether for investment or re-sale.
Philippine Ratings Services Corp. is so impressed with its performance and outlook that it has given the top rating of "PRS Aaa"- with the smallest degree of investment risk for the P4 billion bonds it plans to issue.
PRS said that Ayala posted bookings for 1,000 units from its 50 projects in the first quarter of the year, 17 percent higher than the same period last year.
It added that the company even improved on its average percentage completion for different projects this year.
ALI's gross revenues in the first quarter reached P8.23 billion, 28 percent higher than last year's figure. Residential units alone accounted for gross revenues of P3.5 billion.
The company also hiked rental rates on office space and shopping centers.
Gross leasable area from shopping centers also rose from the expansion of Ayala Center Cebu, Greenbelt 5 and Trinoma in Quezon City.
These projects accounted for a 30 percent increase in gross leasable area over the 2006 figure.
Philratings noted that ALI has a "remarkable track record of consistent profitability" despite the peaks and valleys of the real estate industry cycle. Notwithstanding "prevailing issues and looming uncertainties," PhilRatings affirmed the company's plans for sustained growth through its residential developments, shopping centers and corporate business line.
In 2008, Ayala Land budgeted P24.3 billion in capital expenditures 42 percent of which would be earmarked for residential developments, 30 percent to corporate business lines, 14 percent to shopping centers and the rest to other business lines.
Ayala Land senior vice-president and chief finance officer Jimmy Ysmael, said one of the company's most significant projects continues to be the development of the first phase of Nuvali, a large-scale, fully-integrated regional development in Canlubang, Laguna.
At least P6 billion has been allotted to develop phase 1 of the project. By year end, the first office building, already keenly received by business processing outsourcing companies, will be operational. A retail strip will also be operational by that time.
ALI noted that the high-end Abrio with 309 units is 96 percent taken up while 89 percent of Avida Settings' 431 units catering to affordable housing segment have been committed. Treveia, which caters to urban achievers, entrepreneurs and managers, reported that 48 percent of 606 units had been taken up.
Land values are likewise expected to rise further at Bonifacio Global City which is a joint venture between Ayala Land and the Campos Group. Construction of the Mind Museum, a 6-star Shangri-la hotel complex, the PSE Center and the opening of St. Luke's hospital are all expected to further prime activities there.
In the shopping center line, Ayala Center Cebu is expected to launch the "Greenbelt of Cebu" in late 2008.
Ayala Center in Makati will launch Glorietta 5 consisting of three levels of retail and five levels of business processing outsourcing offices. Phase 2 of Greenbelt 5 is also expected to open in October 2008.
Continuing demand from the domestic market driven by increased affordability, strong remittances from Overseas Filipinos who accounted for 23 percent of total residential sales in the first quarter of 2008 and the rapidly expanding BPO sector which will be needing an estimated 3 million sqm. in office space in the next three years, are expected to sustain ALI's growth.
ALI will issue the 5-year bond at par and bench-marked against the Philippine Dealing System Treasury Referrence rate.
BPI Capital Corp., HSBC and Land Bank of the Philippines were tapped as joint lead managers and underwriters for the bond issue.
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