PHILIPPINE REAL ESTATE and RELATED NEWS in and around the country . . .
.
.

NDC to buy out Goodyear in Las Piñas property

By Ma. Elisa P. Osorio (The Philippine Star) Updated August 01, 2011 12:00 AM

MANILA, Philippines - The state run National Development Corp. (NDC) will buy tire maker Goodyear Philippines’ share in the 18-hectare prime property in Las Piñas for P872 million.

“We are exercising our option to purchase the Goodyear property,” Trade Secretary Gregory L. Domingo said in an interview with reporters.

According to Domingo, NDC had the right of first refusal. The right of first refusal means that Goodyear must first offer the property to NDC before entertaining other buyers. NDC owns 60 percent of the property and the P872 million is for the remaining 40 percent.

Domingo said they were able to get a good price for the property because he said it is below the appraisal value. Goodyear originally wanted P14,000 per square meters. Domingo said NDC made a counteroffer of P10,000 per square meter. The agreed selling price was at P12,000 per square meters.

Domingo said NDC will be sourcing part of the money from government financial institutions (GFIs).

As of now there is no concrete plan for the property but said it is a nice property. Domingo said there is no more available lot in that area that is that big. “I’m sure if we open it up a lot of companies will be interested.”

The better strategy is to not sell because it is a prime piece of property. We will hold the land then enter into a long term lease,” he said.

Domingo said they are more partial to a long term lease arrangement than a joint venture. The Goodyear property already has its own mini-power plant and is ideally located behind Ayala Alabang and the SM mall. It would be ideal for a mixed commercial and residential development.

In 2009, Goodyear closed its manufacturing plant here. Its manufacturing plants in Malaysia, Indonesia and Thailand are now supplying the local demand for tires.
______________________________________________________________

Groups up in arms against casinos in Boracay

08/01/2011 [ tribune.net.ph ]
By Gerry Baldo

An anti-corruption party-list group yesterday urged religious and other anti-gambling advocates to back the hundreds of Boracay residents in opposing the planned construction of gambling dens in the island resort.

Citizens Battle Against Corruption Rep. Sherwin Tugna said it is imperative that Boracay residents get the support they need in opposing the move.

“Putting up casinos will surely ruin the beautiful scenery in Boracay,” Tugna said.

Tugna also expressed apprehensions that gambling could trigger criminal activities in the island-resort considered by many as one of the best in the world.

“This will also result in higher crime rate in the island due to the need for more money to satisfy gambling addiction. Not to mention the added environmental pressure that this will bring to the island because of influx of gambling enthusiasts,” Tugna said.

Boracay residents have protested the plan even as they asked the Aquino government to reject any application to operate “all forms of casinos” on the island.

Those who joined the protest were members of the the Philippine Chamber of Commerce and Industry in Aklan, Couples for Christ, Boracay Foundation Inc., El Shaddai and the Federation of Senior Citizens of Malay.

Boracay parish priest Fr. Magloire Placer said “we hope that President Aquino and the national government will listen to our appeals to reject the casino petitions.”

The Malay government where Boracay Island belongs has endorsed two applications for operating a casino and a “junket operation” in Boracay.

These include the proposal of the Cariño Development Management Corp. to build a casino at the posh 120-hectare Fairways and Bluewater Resort Golf and Country Club and the application of the Crown Regency Resort and Convention Center to be a venue of “junket operation” in Boracay. Junket operations are pre-organized gambling tournaments for foreign players.
_____________________________________________________________

Belle profits fall on lower sales

Posted on July 31, 2011 10:11:02 PM [ BusinessWorld Online ]

BELLE CORP. profits dropped in the first half due to lower revenues, data from the luxury developer and gaming firm’s filing with the Securities and Exchange Commission showed.

The Sy-led firm reported a consolidated net income of P102.1 million for January to June, 43.7% lower than the P181.3 million it reported for the same period last year.

Gross profit, meanwhile, declined by 41% to P215.5 million versus June 2010’s P367.9 million.

This, as revenues in the first half fell by 46% to P359.4 million as it instead devoted resources to developing the casino complex Belle Grande Manila Bay which will only be ready by the second quarter next year.

In contrast, revenues in the same period last year benefited from the launch of three projects.

But the company said it hopes to shore up revenues in the second half with the launch of new residential developments.

The drop in revenues in the first half was cushioned by a similar drop in expenses. Costs fell by 61.5% to P232.393 million, largely due to a decline in costs involved in selling real estate.

The company’s assets, meanwhile, grew 67% to P17.619 billion due to increases in the value of the firm’s investments. Liabilities similarly increased by 40% to P6.071 billion for the period as the company took on more loans.

Equitized net earnings from associated companies climbed by 3% to P60.7 million from P59.2 million in the 2010 period due to higher earnings from subsidiary Pacific Online Systems Corp. in which Belle holds a 35% interest.

The subsidiary leases online equipment to the Philippine Charity Sweepstakes Office for lottery operations in Visayas and Mindanao.

Belle Corp. shares were traded 0.21% higher at P4.71 last Friday. -- F. J. G. de la Fuente
____________________________________________________________

Manila backs conversion of PPA property in Port Area into a financial district

By Ma. Elisa P. Osorio (The Philippine Star) Updated July 30, 2011 12:00 AM

MANILA, Philippines - The local government of Manila is appealing to the National Government to finally agree to the conversion of the multi-billion lot behind Manila Hotel into a financial center.

Speaking before businessmen during the 19th Metro Manila Business Conference at the Manila Hotel yesterday, Manila Mayor Alfredo S. Lim said they would like to build a financial center in Manila, similar to that in Makati.

Lim said he is eyeing the lot owned by the Philippine Ports Authority (PPA) that is why he is calling on the Department of Transportation and Communication (DOTC) to manage this land. He said that he has already proposed the project three times but no action has been taken yet.

Lim said the property is 20 hectares and is occupied by dilapidated warehouses. He estimated that the market value of the properties in Roxas Boulevard is between P80,000 to P100,000 per square meter.

“You can check anywhere in the world, the most expensive are waterfront properties,” the mayor said in Filipino. He said all the warehouses must be demolished and the only building left would be the Bureau of Customs (BOC).

Lim described that the financial district will be sandwiched between Intramuros and Manila Bay. He said the property is fronting the walls of Intramuros and the back is the view of Manila Bay. He said this is a clear advantage of the proposed financial district because Intramuros has a golf course. Golf is the game of choice of most businessmen.

Aside from the businesses, Lim said condominiums may be built in the proposed financial district but he said the minimum number of floors is 30.

Lim said that before his term, there was little to no construction in Metro Manila because of an ordinance released in 2001 limiting buildings to 19 storys. Lim said businessmen were complaining that shorter buildings means that they will not be able to maximize profits.

Lim said he checked the National Building Code and there is no limit in the code. Lim said he repealed the ordinance and now there are two 57-story condominium projects under construction. One is in China town and the other is at the back of the Admiral Hotel. “This will change the skyline of the city.”
_______________________________________________________________

REIT worries raised

Posted on July 28, 2011 11:24:57 PM [ BusinessWorld Online ]
BY DIANE CLAIRE J. JIAO, Reporter

STRINGENT TAX RULES will likely deter developers from setting up real estate investment trusts (REITs), industry officials said, with new escrow provisions adding to earlier concerns.

“The new rules... will make it even more difficult for large real estate companies to establish REITs. This will likely be a big amount, and it will affect the liquidity of companies,” BDO Capital and Investment Corp. President Eduardo V. Francisco told BusinessWorld on Wednesday.

Revenue Regulations 13-2011, issued by the Bureau of Internal Revenue (BIR) on Tuesday, detail the tax rules needed to implement REITs, stock corporations that pool investor funds to manage real estate assets.

The BIR granted a documentary stamp tax (DST) incentive to developers so that they would only have to pay 50% of the applicable DST when they transfer real property into the REITs.

Firms were also allowed to deduct dividends from gross revenues, bringing down their income tax obligations as they are required to distribute at least 90% of profits to shareholders.

At the same time, though, the rules required REITs to set up escrow accounts equivalent to the taxes they would be exempted from. These include the other 50% of their DST fees as well as the income tax due on dividends.

While the escrow amounts would vary, Mr. Francisco claimed this would be a “big burden.”

Colliers International Philippines’ director of valuation Marissa Y. Benitez said the firms’ money would be put to unproductive use.

“Instead of using this money elsewhere for operations, they will have to be parked in escrows, earning very little in interest,” she said in a phone interview yesterday.

According to the BIR rules, the funds will be released back to the firms only after they list in the Philippine Stock Exchange (PSE), where they are required to maintain a 40% minimum public float that needs to be increased to 67% within three years from listing.

Ms. Benitez warned that REIT firms could fail to reach the float requirement by no fault of their own.

“The Philippines has a small population investing in the stock market. What if the firms offer the shares to the public but only a few avail of them?” she said.

“Currently, a lot of listed companies cannot even reach the 10% public ownership rule imposed by the PSE,” Ms. Benitez added.

The local bourse has set a November deadline for all listed firms to comply with the 10% float requirement. Some firms have said they were willing to delist or bear with penalties instead.

AB Capital Securities, Inc. analyst Arlysa E. Narciso shared the sentiment, saying, “The 10% float is already a challenge for some companies. The 40% to 67% requirement places a high demand on REITs.”

Moreover, real estate companies expect interest rates to increase later this year due to inflation, which could bring up their borrowing costs and affect revenues, she explained. This could dampen demand for their shares.

The liquidity restrictions due to the escrow requirement could also bring down REITs’ valuations, affecting their marketability, Colliers’ Ms. Benitez added.

Under these scenarios, the real estate companies would lose their escrow funds despite their attempt to open the REITs to the investing public, she pointed out.

The restriction represents another hurdle for developers who were already dissatisfied with the government’s other REIT rules. During the protracted negotiations, businesses had lobbied for a 33% public float.

The PSE itself released a position paper saying that the Philippines’ 40-67% requirement would be the highest in the region.

The value-added tax (VAT) on the transfer of property into the REIT vehicle was also hotly contested as the investors hoped for an exemption.

“Just with the rules on VAT and the minimum public ownership, it was already unlikely that the large real estate companies would set up REITs. Now, the escrow will be another hurdle,” said BDO Capital’s Mr. Francisco, who also represents the private sector in the Capital Market Development Council.

Property giants that have expressed interest in REITs, such as SM Prime Holdings, Inc. and Ayala Land, Inc., remained unavailable for comment.
____________________________________________________________

real estate central philippines
Copyright ©2008-2020