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Empire East allots P25B for expansion

Posted on July 10, 2013 10:33:14 PM [ BusinessWorld Online ]
By Cliff Harvey C. Venzon, Reporter
EMPIRE EAST Land Holdings Inc., a unit of Megaworld Corp., plans to spend P25 billion in the next five years for more projects and land bank expansion, an official said yesterday.
The five-year spending program, which starts this year, will be funded through internally generated cash and equity from its parent firm, company President Anthony Charlemagne C. Yu told reporters during the company’s stockholders’ meeting in Quezon City. Megaworld last month infused P1.26-billion in fresh capital into Empire East as part of tycoon Andrew L. Tan’s efforts to consolidate his real estate assets under Megaworld. Mr. Tan is the chairman of Megaworld.
For this year alone, the company has set aside up to P4.5 billion for construction expenses, Mr. Yu said.
“As part of our 2013 strategy, we are looking to launch new real estate concepts and expand our territory in the South [Luzon] as a way to stimulate the market and gain an edge over our competitors,” he said.
Meanwhile, Mr. Yu said Empire East is also looking at acquiring land assets in North Luzon.
“The past few negotiations and conclusions were all in Metro Manila and one ongoing negotiations in the South and we are open to looking at North [Luzon] now,” he said, adding that the looming opening of Tarlac-Pangasinan-La Union Expressway this year opens a “lot of opportunities for the company.”
“From 2012 to May this year, we were able to secure new tracts of land, which include properties located in Quezon City, San Juan, Parañaque and Las Piñas,” Mr. Yu said.
The company ended the previous year with 450 hectares of land bank, he said.
TALKS WITH OKADA GROUP
Meanwhile, Mr. Yu said Empire East is still in “ongoing discussions” with the group of Japanese tycoon Kazuo Okada for a residential project at the Bagong Nayong Pilipino Entertainment City in Parañaque City near Manila Bay.
Okada Group’s Tiger Resort Leisure and Entertainment, Inc. has one of the four licensees to operate at the Entertainment City.
Empire East and Tiger Resort last year forged a P45-billion joint venture agreement which called for the development of a luxury residential resort condominium project in Okada’s Manila Bay Resorts, an integrated casino complex.

Aside from Empire East, Okada Group also negotiated with Robinsons Land Corp. for residential, commercial and casino operations projects at the integrated gaming complex. Talks, however, collapsed in May due to undisclosed reasons.
Asked if Empire East would be willing to takeover the casino operations of Manila Bay Resorts, Mr. Yu said: “We are not into gaming. That’s not our core competence. Its very clear that we are not entering into any gaming venture.”
The official went on to note that the company is optimistic of topping its financial performance last year.
“We think we can beat the performance last year, with very high rate of sales,” Mr. Yu said.
The company’s net income grew by 26.45% to P235.35 million last year from P186.12 million the year before as real estate sales rose by 40.40% to P1.38 billion from P983.53 million.
For this year, the company has so far booked a net profit of P50.33 million in the first quarter, almost double from P27.75 million in the same period last year.
The company’s first-quarter real estate revenues went up by 20.08% to P557.09 million this year from P463.95 million last year.
Shares of Empire East dropped three centavos or 3.13% to P0.93 apiece yesterday.
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