Friday, September 4, 2009 | MANILA, PHILIPPINES [ BusinessWorld Online ]
Filinvest Land, Inc. will turn a 50-hectare lot in Cebu City’s South Road Properties into a new central business district.
GOTIANUN-LED Filinvest Land, Inc. will start construction on the 50-hectare land that it will co-develop with the Cebu City government early next year.
Tristan Las Marias, Filinvest Land vice-president for Visayas and Mindanao, said the plan is to develop a cluster of mid-rise condominium buildings, as part of a bigger plan to turn the reclaimed South Road Properties into a new central business district.
"We are going to put retail, residential building, and office developments," Mr. Las Marias told reporters in a briefing.
Filinvest Land will spend some P20 billion for construction. The whole project will likely take 10 to 20 years to be fully developed, he said.
In February, Filinvest Land and the Cebu City government signed a deal to develop 50 hectares of the 300-hectare local government-owned prime property.
The South Road Properties is touted as the centerpiece of the city’s redevelopment.
The Cebu City government reclaimed the land with the help of the Japan Bank for International Cooperation, which had extended a ¥12-billion loan through Land Bank of the Philippines.
The property is registered as a special economic zone, designed for mixed land use that can accommodate light manufacturing, as well as commercial, tourism, information technology and other service enterprises.
Filinvest Land President Joseph M. Yap said the company has the resources and capability to develop more projects in the future. As of June, Filinvest Land’s consolidated assets have reached P131.5 billion. It still has 2,500 hectares of land for development.
"So we have the capacity to reach new markets and widen our scope of development. We have a wide range of products although currently the bulk of our sales comes from the middle- to low-end segments of the market," Mr. Yap said.
Mr. Yap, however, said the company would continue to focus on its niche market because of its resiliency, since the middle- to low-end segments mostly cater to "end-users," or those who want to own their own homes.
Overseas Filipinos, Filinvest Land’s primary market, are also entrenched in these segments, Mr. Yap noted.
Mr. Yap said he is looking at the future with "guarded optimism," adding that Filinvest Land expects to see a reasonable growth in remittances, which should have a major impact on the real estate industry.
"For the rest of the year, we expect the company to grow by 10% to 15% [with our overseas Filipino customers] as the main growth driver," he said.
Filinvest Land will sell up to P5 billion in fixed-rate bonds next month to fund its capital expenditure this year and the next.
"We will issue it next month, maybe mid-October," Mr. Yap said, adding the debt sale would range from P3 billion to P5 billion depending on market demand.
The company, a unit of conglomerate Filinvest Development Corp., is spending P4 billion this year on capital requirements and may set aside the same amount for its 2010 expenditure, Mr. Yap said.
Filinvest Land has submitted to the securities regulator a debt sale plan of P3 billion, with a greenshoe option of P2 billion.
Yesterday, the company launched the two-tower The Beaufort at Bonifacio Global City in Taguig. The project, which occupies a 3,800-square-meter (sq.m.) property, will cost the company around P3 billion.
The first tower will have a total of 145 units. Prices will range from P3 million (a 36-sq. m. studio unit) to P18 million for 151-sq. m. loft units.
The Beaufort Project Officer Ethel C. Balicanta said studio units have already been sold out.
The project is expected to be completed by 2012.
Shares in the company yesterday gained 1.03% or a centavo to close at P0.98 apiece. — with Reuters
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