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Filinvest raises capex to P38 B

By Neil Jerome C. Morales (The Philippine Star) | Updated May 31, 2014 - 12:00am

MANILA, Philippines - The investment firm of the Gotianun family is raising its capital spending this year to support property development projects and its foray into the power generation business.

Filinvest Development Corp. (FDC) expects its large investments in various sectors would allow the company to post higher earnings in the coming years, its top executive said yesterday.

The listed holding firm said it would invest P38 billion across all its businesses this year, higher than the earlier announced P33 billion and almost double the P20 billion it spent last year.

“With the continuing strength of the Philippine economy and the recent ratings upgrade, we are optimistic that these investments will sustain the growth of FDC,” said FDC president and CEO Josephine Gotianun-Yap.

“These investments will, in turn, drive earnings growth for the next five years,” she added.

Specifically, FDC allocated around P25 billion for the real estate business composed of subsidiary Filinvest Land Inc. and Filinvest Alabang Inc., the developer of the 244-hectare Filinvest City in Alabang.

“A more significant portion of the capital expenditures will be used for recurring income investment properties while the balance will be for trading assets with a portion to be used for landbanking,” FDC said.

The listed investment firm allotted P9 billion for the construction of FDC Utilities Inc.’s 405-megawatt (MW) power plant in Misamis Oriental that is scheduled to start operations in 2016.

The remainder of the capital allotment would be poured into the hotel, banking and sugar operations.

For instance, subsidiary FDC Hotels Inc. has started the construction of the 192-key, five-star Crimson Resort and Spa development in Boracay, while financial service arm EastWest Bank targets to end the year with 400 branches from the current 376 outlets.

FDC recorded lower earrings in the first quarter, weighed down by lower income contribution from the banking unit. Net income attributable to equity holders of the parent firm sank 27 percent to P701. 29 million from P966.34 million a year ago.

Total consolidated revenues and other income reached P9.05 billion in the first quarter, slightly higher than the P9.01 billion last year.
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Mall firm starts 2014 expansion

Posted on May 30, 2014 09:02:45 PM [ BusinessWorld Online ]

SM PRIME Holdings, Inc. has opened its first mall in Cagayan Valley -- one of three new shopping centers planned for the year -- the main property arm of SM Group said in a statement attached to a disclosure on Friday.

Opened on Friday was SM City Cauayan in Isabela -- one of three new malls planned for opening this year besides those in Angono, Rizal and in Zibo City in Shandong, China.

The 66,299-square meter mall in Cauayan City, which has a nature-oriented design, is SM Prime’s first open strip mall. It uses ceiling fans instead of airconditioner units for a “green and cost-effective approach”, the firm said in its statement.

“The mall’s exterior features will also include warmly colored panels set in a random pattern to give an air of gaiety and festivity and will be combined with glass and steel finishes for a modern touch,” the statement read.

Aside from SM stores, the mall will also have Watsons and ACE Hardware; fashion brands such as Guess, Payless, Giordano and For Me; as well as homegrown restaurants such as Chocolate Cofeeline, Yah Coffee and Café Isabela.

It has a total of 570 parking slots, with 316 in the car park building.

Cauayan City, considered the central business district of Cagayan Valley, has over 2,000 registered businesses. It is also near 11 Isabela municipalities, making it accessible to over half a million people.

“SM Prime’s entry into Cauayan reflects its optimism in the growth potential of provincial areas on the back of a robust Philippine economy. Encouraged by positive results delivered by its provincial mall openings, SM Prime seeks to expand in various regions outside Metro Manila where it is seen as a catalyst for development,” the statement read.

SM Prime saw consolidated net income rise 11% to P4.58 billion last quarter from P4.11 billion the previous year, as consolidated revenues rose 3% to P15.35 billion from P14.95 billion. Rental revenues, which made up 56% of consolidated revenues, grew 12% to P8.56 billion from P7.63 billion, mainly due to new malls that opened in 2012 and 2013. Real estate sales contributed a third to total revenues at P5.02 billion, while “other revenues” from malls, residential, commercial business, leisure properties as well as hotels and convention centers made up 11% at P1.77 billion. Gross expense slightly went down by 3.63% to P9.6 billion from P9.97 billion.

This year, the firm also plans to expand SM City Bacolod and SM Lipa after the launch earlier this year of SM Mega Fashion Hall at SM Megamall in Mandaluyong City that increased that mall’s gross floor area to 506,435 sq.m.

SMIC’s property business -- consolidated last year under SM Prime -- consists as well of SM Development Corp.; Highlands Prime, Inc.; Costa del Hamilo, Inc.; Prime Metroestate, Inc.; and SM Hotels and Conventions Corp.

SM Prime shares closed P16.76 apiece on Friday, up 42 centavos or 2.57% from P16.34 last Thursday. -- DJM            
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NEDA Board approves 7 new infra projects worth P45-B

(philstar.com) | Updated May 30, 2014 - 4:23pm

MANILA, Philippines - The National Economic and Development Authority (NEDA) Board approved on Thursday seven new infrastructure projects worth P45.04 billion, NEDA announced.

The NEDA Board, the country's socioeconomic development planning and policy coordinating body, approved the following:

1. Laoag City Bypass Link Road Project (P1.19 billion)
Proponent: Department of Public Works and Highways
Description: Construction of a Portland Cement Concrete Pavement (PCCP) two-lane road with ROW of 30-meters. It involves the construction of a 3.11 kilometer PCCP road including a 735.0 lineal meter Steel Girder Type Bridge that crosses the Laoag-Padsan River, and end at the Gomburza Road intersection (Phase 1) and construction of a 4.87-kilometer PCCP road (Phase 2).

2. Busuanga Airport Development Project (P4.1 billion)
Proponent: Department of Transportation and Communications
Description: To improve the capacity of the Busuanga Airport in a manner that will satisfactorily serve the expected increase in air traffic in Northern Palawan, through the improvement of the existing airport facilities.
 
3. Cebu Bus Rapid Transit (BRT) Project (P10.62 billion)
Proponent: Department of Transportation and Communications
Description: Project will establish a BRT System in Cebu City
 
4. Modernization of the Dr. Jose Fabella Memorial Hospital (P2 billion)
Proponent: Department of Health
Description: Construction of a new nine-storey, 800-bed hospital with emergency room facilities; offices and pharmacy; laboratory and radiology facilities; delivery room complex; intensive care unit (ICU) complex, with a 130-bassinet capacity Neonatal ICU; suites, private rooms, and wards; administration offices, training facilities and auditorium; and other support facilities.

5. Water District Development Sector Project (P2.69 billion)
Proponent: Local Water Utilities Administration (LWUA)
Description: Proposed relending facility under LWUA, aimed at targeting pre-credit worthy to semi-credit worthy Water Districts for the rehabilitation and expansion of their distribution networks, development of raw water supply and enhancement of the sustainability of operations through capacity development.

6. Angat Water Transmission Improvement Project (AWTIP) (P5.78 billion)
Proponent: Metropolitan Waterworks and Sewerage System
Description: Construction of a new tunnel, i.e., Tunnel 4, that will make it possible to alternate close the older tunnels and aqueducts in the conveyance system, to improve the reliability and security of the Angat raw water transmission system, through the rehabilitation of existing conveyances and appurtenances from Ipo Dam to La Mesa Treatment Plant.
 
7. New Centennial Water Source – Kaliwa Dam Project (P18.72 billion)
Proponent: Metropolitan Waterworks and Sewerage System
Description: Involves financing, design, and construction of the 600 million liters per day Kaliwa Dam, intake facilities and other appurtenant facilities; and Water Conveyance Tunnel with a capacity of 2,400 MLD (in anticipation of future construction of the Laiban Dam). Construction of water treatment plants will be undertaken by the MWSS concessionaires.
 
Other projects approved include the P14.34-billion operation and maintenance of the Light Rail Transit Line 2 under the public-private partnership program and the master development plan for the Clark Green City which involves the development of a total of 9,450 hectares of land including the bidding of an initial 1,300 hectares for Phase 1.

“The approved projects are aimed at improving the level and standards of service in the water, health, and transport sectors as called for in the Updated Philippine Development Plan 2011-2016 towards achieving inclusive growth,” Socioeconomic Planning Secretary Arsenio Balisacan said.
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Clark City emerging as next Fort Bonifacio

By Othel V. Campos | May. 30, 2014 at 12:01am [ manilastandardtoday.com ]

A real estate advisory firm described the Clark City project of Bases Conversion and Development Authority in Pampanga as the “next Fort Bonifacio” in terms of real estate development.

“With quality labor pool, developing infrastructures, economic incentives, and improved air and land accessibility, growth and expansion opportunities in the area are seen in the coming years, making it one of the most excellent real estate prospects today. We see Clark as the next Fort Bonifacio,” CBRE founder and chairman Rick Santos said during a news briefing at the Shangri-La Hotel in Makati City.

Clark, a former US military base, proved to be more than just a part of the Philippines’ history, as it now home to a number of industries that contribute to the growth of Central Luzon, the real estate advisory firm said.

It said high accessibility via modern tollways and proximity to the Clark International Airport made Clark an ideal investment and development area for local and foreign investors.  Clark is also a part of the third largest business process management market in the country.

CBRE said with an expected growth of 1.3 million direct employment by 2016 and the scarce vacancy in the country’s metro central business districts, business processing sector’s growth was reaching towards areas such as Clark.

“From bases to BPMs, Americans return to Clark for business process outsourcing, call centers, and other ventures. As the sectors expand—especially that of the BPM, we see more developments in other real estate fronts such as residential and retail, also picking up its pace to meet the demand. Mixed-use developments and other projects that will cater to this are under way,” said Santos.

Santos said Clark would contribute significantly to the growth of the BPM sector to reinforce the Philippines as “the call center capital of the world.”
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More property projects rising in Davao City

Posted on May 29, 2014 11:31:07 PM [ Businessworld Online ]

DAVAO CITY has turned out to be one of Metro Manila-based property developers’ prime expansion sites, with two listed companies -- Megaworld Corp. and Sta. Lucia Land, Inc. -- yesterday baring their latest ventures there.

Megaworld said in a statement yesterday that it is spending P1.2 billion to build a 15-storey office tower, called the Davao Finance Center, in Davao Park District -- the city’s first master-planned central business district -- as part of the first phase of the township’s office segment.

Construction will start early next year and is expected to be completed “by 2016.”

The tower will rise at the corner of Dakudao Avenue and Megaworld Avenue, which will become the township’s main artery passing through the commercial, office, and residential areas.

“Davao Finance Center will be the first to rise in Davao Park District because we envision it to be a landmark for business, trade and commerce, especially for information technology and business process outsourcing (IT-BPO) in Mindanao,” the statement quoted Jericho P. Go, Megaworld’s senior vice-president, as saying.

At least four IT-BPO companies have already expressed interest to set up operations at the Davao Finance Center, Megaworld said in its statement, but did not give any detail beyond saying “[m]ost of these companies are first-time locators in Mindanao.”

“There is an abundance of highly skilled human resource, and the existence of centers of excellence ensures there is enough supply for highly skilled human resource to meet demand,” Mr. Go noted of Davao City.

The company is also putting up a McDonald’s store in front of the Davao Finance Center next year. The franchise in the Philippines for McDonald’s fastfood chain is held by Golden Arches Development Corp. -- an affiliate of tycoon Andrew L. Tan’s conglomerate Alliance Global Group, Inc., of which Megaworld is a majority-owned subsidiary.

Davao City, which is Mindanao’s center of trade, commerce, and education, is home to over two million residents and several topnotch universities including the Ateneo de Davao University, University of the Philippines-Mindanao Campus, and the University of Mindanao, among others, Megaworld noted.

Davao Park District is Megaworld’s first township development in Mindanao. Positioned to be the central business district of Davao, the township will have office towers, commercial and retail strips, open parks and lagoon, and themed residential condominiums by Suntrust Properties, Inc., a wholly owned subsidiary of Megaworld. The company is pouring P15 billion for the development of the township in the next five to seven years.

Megaworld townships are clustered primarily in Metro Manila with a few in the Visayas. In 1999, Megaworld opened the 18.5-hectare (ha) Eastwood City in Quezon City which now has 21 residential condominiums, 11 office towers, over 100 companies, and 60,000 office workers. Other Megaworld townships are 50-ha McKinley Hill, 34.5 ha McKinley West, the 5-ha Forbes Town Center, and the 15.4-ha Uptown Bonifacio all in the Fort Bonifacio area; the 12.3-ha Woodside City in Pasig City; the 25-ha Newport City in Pasay City; the 72-ha Iloilo Business Park in Mandurriao, Iloilo City; and the 28.8-ha The Mactan Newtown in Lapu-Lapu City, Cebu.

The company has also residential and commercial projects in Chinatown in Manila’s Binondo district and in Makati City’s central business district.

STA. LUCIA
Sta. Lucia Land, Inc. said in a separate statement yesterday that it has launched SotoGrande Hotel Suites condotel in its 60-ha master-planned community Davao Riverfront Corporate City.

The 15-storey SotoGrande Hotel Suites will have 260 prime residential and commercial units.

Other projects under the Sta. Lucia group in the Mindanao area include Ranchos Palos Verdes Sports and Country Club which has a 77-ha, 18-hole, all-weather championship golf course designed by world-renowned designer Andy Dye.

Other major residential and commercial projects include Valley Verde, Ponte Verde, South Grove, South Pacific, Altea Ciudades, Alta Monte Residential Estates, Ciudad Verde, Las Palmas Verdes and Colinas Verdes.
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