Posted on 08:27 PM, March 07, 2010 [ BusinessWorld Online ]
PROPERTY GIANT Ayala Land, Inc. is looking at spending an additional P6 billion to expand its first leisure project, an executive said on Saturday.
Additional investment will allow Ayala Land to launch more projects and further develop the 320-hectare Anvaya Cove in the town of Morong in Bataan.
“Anvaya development cost could reach around P10 billion. For the existing projects, we have already committed to spend P4 billion,” said Ayala Land senior vice-president Rex A. Mendoza.
Ayala Land wants to get 300 hectares of additional land for expansion, he said.
Anvaya Cove is a joint venture with property owner Subic Bay Development and Industrial Estate Corp. or Sudeco, a private real estate holding firm. Ayala Land has developed as much as half of the 320-hectare property, costing around P1.5 billion.
Funds to be used to fully develop the area would be on top of the total P27.17-billion capital expenditures set by Ayala Land this year, he said.
Additional land from Sudeco will allow Ayala Land to double the existing 545 units owned by 1,700 members.
Residential lots range from 1,200-1,500 square meters in the Cliffside area and about 400-420 square meters in the Mango Grove.
“We came in late because we thought the leisure market in the Philippines is going to be thin,” Mr. Mendoza said.
This year, Ayala Land will launch an indoor sports club and the Seascape Ridge, a 4.6-hectare community that will have 14 multiple dwelling units. Turnover will start in December 2011.
“From [houses and lots], we will be moving to low-rise condominiums,” Mr. Mendoza said. “We realized that the big chunk of the foreign [market] does not want the construction hassles.”
Asked if the exclusive Anvaya Cove will be opened to the public by putting up a hotel, Mr. Mendoza said: “It is being contemplated but that is not going to be part of the beach club. If we will make that, it will be outside.”
Ayala Land, meanwhile, had brisk sales in the first two months of the year, the executive said.
“Total sales of Ayala Land Premier is less than P5 billion for the full year. This year, until February, it is already P5.3 billion,” Mr. Mendoza said.
Projects such as the Santierra in Laguna and Park Terraces in Makati were “choking up [sales] very well” as a result of good timing in project launches, he added.
Ayala Land will also launch economic housing unit Amaia this year. Its first project will involve units priced at P600,000-P1.2 million each in the town of Calamba in Laguna.
Ayala Land expects the ratio of its sales from overseas Filipinos to rebound this year to 28%-30%.
The ratio was 28% in 2009, 18% in 2008, and 33% in 2007.
“[Sales from Filipinos in] Abu Dhabi and the Kingdom of Saudi Arabia are very strong,” he said.
Ayala Land saw profits decline by more than a tenth last year, as the global economic downturn dampened the real estate sector. In its financial report, Ayala Land said net income dropped to P4.681 billion last year from P5.382 billion in 2008 and P5.095 billion in 2007.
Shares in Ayala Land rose to P11.25 each on Friday from P10.75 apiece on Thursday. -- Neil Jerome C. Morales