Monday, September 01, 2008 [ manilatimes.net ]
By Katrina Mennen A. Valdez, Reporter
Ayala Land Inc. (ALI) may continue increasing its prices up to the end of the year given the soaring prices of construction materials, its executives said.
Jimmy Ysmael, senior vice president and chief finance officer, said in a phone interview that double-digit increase in the prices of their projects may be expected for the rest of the year as prices of steel and cement have gone up.
“The increase is actually project specific, so it varies,” Ysmael added.
He said ALI is making the move gradually and on per project basis.
Alfonso Reyes, corporate spokeperson, averred the price increase is ongoing in a bid to mitigate its losses.
“It is difficult to give the average increase, but it ranges from 10 percent to 15 percent. However, some projects could have lower increases,” Reyes said.
Earlier, ALI’s President Jaime Ayala said the company has remained bullish about completing its ongoing projects within this year, amid the soaring prices of construction materials.
ALI has an estimated 100 ongoing projects this year.
“[We] do not see any project delays to take place this year, despite the fact that the prices of basic construction materials have gone up significantly,” Ayala said.
As of this month, the price of iron ore, which is the based material for steel stood at $213 per ton against the same period last year when it cost only at $147 per ton, making local steel to soar by an average of 50 percent owing to strong demand from China and India.
In June this year, iron ore hit its highest at $262.5 per ton versus $119 a ton in the same period last year.
Ayala said the price of steel already doubled, while cement increased by 25 percent.
“So far, [we] do not have a problem on cement since [we] have a locked-in contract with [our] suppliers. On the other hand, it is difficult for us to win a locked-in contract with steel makers,” he said.
Ayala said that in a span of one and a half years, the selling price of their condominium units, among others have already surged by 20 percent due to the soaring prices of basic construction materials.
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