Vol. XXI, No. 239 [ BusinessWorld Online ]
Monday, July 7, 2008 | MANILA, PHILIPPINES
AYALA LAND, Inc. (ALI) has joined the bandwagon of property developers who have increased residential prices because of rising construction costs.
Ayala Chairman and Chief Executive Officer Jaime Ayala said the company has hiked the prices of residential projects by a fifth to help it recover costs from more expensive raw materials.
"Customers and buyers should be careful who they go to when they want to buy condominium units," Mr. Ayala said, adding that despite the increase, there have been no delays in the implementation of the projects and that sales of residential condominiums remain good.
"Like other developers, we are effecting price increase in various projects in order to offset the increasing cost of construction materials such as steel, cement and labor cost," Ayala Land Spokesman Alfonso D. Reyes said in a phone interview.
Mr. Ayala said construction costs take up 10% of the total project cost. Cement prices, for instance, have increased by a quarter, while steel prices have nearly doubled from a year ago. "Luckily, we were able to lock up our cement [procurement] in a three-year contract," he said.
In June, Lucio Tan-led Eton Properties Philippines said it had imposed a 5% across-the-board increase on all residential condominium prices. — Kristine Jane R. Liu
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