Posted on 07:35 PM, April 30, 2010 [BusinessWorld Online ]
Filinvest Land, Inc. of property tycoon Andrew L. Gotianun, Sr., has doubled its capital expenditure for the year to around P7 billion, to allow the company to hike sales from its residential segment.
The firm is targeting a 15%-20% growth in residential sales this year, an executive said on Friday. "For this year, [capital spending] is almost P7 billion. Actual capital last year was P3.3 billion," Joseph M. Yap, president and chief executive of Filinvest Land, told reporters at the company’s annual stockholders meeting in Makati.
"[Funding will be] mostly internally generated," he added.
Annabelle D. Arceo, investor relations chief of Filinvest Land, said P500 million would be used to finish the construction of buildings at the Northgate Cyberzone in Alabang, Muntinlupa. A total of P1.8 billion will be used to buy land, and the rest will be for the development of other projects.
Filinvest Land ended 2009 with a land bank of 2,433 hectares.
Foreseeing higher demand, Filinvest Land will launch P8.6 billion worth of real estate projects -- four socialized housing ventures in Cavite and Batangas south of Metro Manila and the northern Bulacan province, as well as two new "affordable" housing projects, also in Batangas and Cavite.
"For the first quarter, sales are up 26%," Mr. Yap said. "Our guidance for sales growth is about 15%-20%."
Last year, the firm’s residential unit had P7 billion in sales. It accounted for 70% of total sales. About a third came from the lease of business process outsourcing offices.
Mr. Yap said Filinvest Land is also looking at setting up a real estate investment trust (REIT) company to secure more funds. "We are studying the possibility of doing a REIT. The company has been in discussion with some investment bankers," Mr. Yap said.
In December, the REIT bill, which will allow companies to use pooled capital of investors to buy and manage income-generating property and mortgage loans, lapsed into law. Last week, the Securities and Exchange Commission released a draft of the implementing rules for the REIT law.
Shares in Filinvest Land went up on Friday to P0.97 apiece from P0.94 on Thursday. -- Neil Jerome C. Morales
______________________________________________________________
