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Phinma Property defers maiden share sale

    Published : Wednesday, October 19, 2011 00:00 [ ]

PHINMA Property Holdings Corp. said it would postpone its initial public offering amid the expected slowdown in the low-cost and affordable segment of the market on tighter competition, massive supply and weakening purchases of overseas Filipino workers.

On the sidelines of a forum, Willie Uy, Phinma Property president and chief executive, told reporters that it may miss its target launches this year as real estate developers fight for customers in the lower segment of the market.

Phinma earlier said it would launch three projects this year, bringing 4,900 units to market.

“You see promotions and huge discounts given to buyers right now. Some of these big developers don’t even ask for down payments anymore. All you do is prove you can afford it [and then you can move in],” said Uy.

Real estate giants Ayala Land Corp. and SM Development Corp. have begun to build developments for the lower segment of the market.

“If you are the buyer, you will consider all the products and see where you can get the best value for your money,” Uy said.

Also making matters worse is the slowdown in OFW purchases, which is considered as one of the biggest markets for real estate developments.

“I’m not saying they are not buying but for those that are affected in the Middle East and even in Europe, they are looking more at job security first before they do a big purchase like a house,” Uy said. Overseas-related sales account for 14 percent to 16 percent of Phinma Property’s total sales.

“I still think they are going to buy because you need to have your own house eventually. It’s a matter time, but I hope we can weather this out in a year or two,” Uy said. Phinma Property, which offers projects ranging from P1.2 million to P1.9 million, said the name of the game now is selling price and the company is undertaking measures to become cost-efficient.

“What we’re trying to do is look for ways where we can be efficient in construction, to reduce our construction costs because I’d like to maintain my prices,” said Uy. For next year, Phinma Property is on a “wait-and-see” stance, but intends to build new projects in Pasig, Cebu and Mindanao.

Ramon del Rosario, Phinma Corp. president and chief executive, said it may move the property unit’s maiden share sale next year as the company awaits the proper timing.

The firm earlier said it may hold the IPO this year.

“We really are looking for a much better environment. We want to be ready. We do intend to list but the question is timing,” said del Rosario.

Phinma shares rose to P11.70 each on Tuesday from P11.60 each on Monday.

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