Monday, October 19, 2009 | MANILA, PHILIPPINES [ BusinessWorld Online ]
THE COUNTRY’S largest property developer, Ayala Land, Inc. will further boost its international marketing presence by selling to neighboring Asian countries next year, focusing on a newly formed lower-end housing brand.
Ayala Land Senior Vice-President Rex A. Mendoza said in a chance interview that the company might soon sell its Homestarter Bonds to Filipinos abroad after its success among domestic investors.
"Overseas sales are very good. There are some pockets in the US that are not hard hit, especially those Filipinos who work in the health care sector like the doctors and the nurses," Mr. Mendoza said.
Mr. Mendoza said Ayala Land has ventured in the "nontraditional" parts of the US like Chicago and some Midwest states where most Filipinos are in health care professions.
Local property developers have seen their sales to Filipinos in the US hit following the global economic meltdown last year.
But because of Ayala Land’s new strategy, where it now tries to reach out to a "wider base" by focusing on "specific segments," the company has noticed an improvement in international sales, Mr. Mendoza said.
International sales have already picked up after slipping by almost a third last year, he said but did not elaborate.
"Before, we do not profile our market and that was a marketing dilemma ... When you make a presentation, you bore one party and excite the other one. Right now with a more profiled approach, [it seems to be working]," Mr. Mendoza said.
Because of this, Mr. Mendoza said Ayala Land would start marketing a newly formed sub-unit of Alveo Land that caters to low-cost housing.
Ayala Land offers products under three units — Ayala Land Premier which targets the high-end market; Avida Land which offers products to the middle-income sector; and "affordable" brand Alveo Land.
This year, the property developer said it would offer products priced lower than those of its affordable brand, with low-cost and middle-income housing proving to be resilient during economic downturns.
To jump-start its entry into this sector, which is dominated by developers like Consunji-led DMCI Homes, Inc., the property giant will start developing a 20-hectare property in San Pedro, Laguna into 2,000 residential units priced between P600,000 to P1.25 million each.
Ayala Land said this would increase its presence to 34% of households from the current 7%. Families that have a combined household income of at least P15,000 to P50,000 per month will be able to avail themselves of the new project which will be launched next year.
Mr. Mendoza said Ayala Land would go overseas next year to sell the new units, particularly to the Middle East and Hong Kong.
"There are big markets in Singapore and Hong Kong that we are not tapping because we do not have the product. I have to admit the Hong Kong market for instance cannot buy Avida," Mr. Mendoza said.
"For that other sub-brand of Avida, [I think that] is going to be very strong in the Asian market because it has a larger base. The disposable income for Filipinos is Hong Kong [is big]. While Singapore is mostly bankers, Hong Kong is largely domestic helpers [who can afford our new product]," Mr. Mendoza said.
Following the success of two Homestarter bond issuances, Ayala Land might sell a third tranche overseas, but will still have to get partner banks.
Profits of Ayala Land fell by a third to P2.07 billion from January to June because of lower residential sales. Shares in the property developer slipped by 2.22% or P0.25 to P11 on Friday. — Kristine Jane R. Liu
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