Vol. XXI, No. 240 [ BusinessWorld Online ]
Tuesday, July 8, 2008 | MANILA, PHILIPPINES
ROBINSONS LAND Corp. has increased the prices of its units by about 10% to offset rising construction costs and protect its margin.
"Sales are quite good. The real challenge for the industry is construction costs," President and Chief Operating Officer Frederick D. Go said yesterday.
He added that while residential condominium sales remained strong, the industry as a whole should protect its profit margin. Mr. Go said construction costs make up a quarter of the total project cost.
Robinsons Land is among several developers that have increased its prices following a 25% rise in cement prices, while steel prices have nearly doubled from a year earlier.
Lucio Tan-led Eton Properties Philippines, Inc. has hiked residential prices by 5%, while Ayala Land, Inc. (ALI) has increased real estate prices by a fifth. Meanwhile, homebuilder Vista Land and Lifescapes, Inc. has hiked housing prices by 3% to 5%.
Despite rising construction costs, property developers continue to build residential and commercial projects. Robinsons Land yesterday launched its fourth residential project and the seventh building project at its 6.5-hectare Cybergate City along Pioneer St. in Mandaluyong City.
The 33-storey Two Gateway Place will occupy 3,000 square meters of the 6.5-hectare development. It will house 331 units and 268 parking spaces. It is at the corner of EDSA and Pioneer St., 10 minutes away from the business districts of Makati and Ortigas in Pasig.
Robinsons Land expects the project to be completed by December 2012 and generate an estimated revenue of P700 million. The 64-square meter unit will cost about P5 million at P77,000 per square meter, the company said.
Mr. Go declined to disclose the cost of the residential condominium project, but said it is part of the company’s P12-billion capital expenditure this year.
Mr. Go noted that aside from Two Gateway Place, six of the 10 projects for the master planned community have been completed, two are already under construction, while the remaining residential project, Three Gateway Place, will be launched next year.
The projects include the Robinsons Mall, residential condominiums One Gateway Place and Gateway Garden Ridge, and three business process outsourcing (BPO) offices. Residential condominium Gateway Garden Heights and BPO office Cybergate Plaza are already under construction, Mr. Go said.
Robinsons Land is seeking to expand its projects in AmiSa, a resort community with a hotel and residential condominium in Cebu; Trion Tower in Taguig; and Woodsville Viverde Mansions in Parañaque.
Its rivals are also expanding. Listed Anchor Land Holdings, Inc. has allotted P3 billion to develop Sky Suites, a 55-storey tower in Binondo. Ayala Land has also entered into a deal with Camp John Hay Development Corp. to build six BPOs in Baguio. — Kristine Jane R. Liu
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