DOF pushes measure on property valuation

By Zinnia B. Dela Peña (The Philippine Star) | Updated February 26, 2015 - 12:00am

MANILA, Philippines - The Department of Finance is lobbying for the passage of  a legislative measure that seeks to establish a fair and uniform real property valuation system and raise as much as P17.6 billion in additional tax annually.

Finance Secretary Cesar Purisima said the passage of the Valuation Reform Bill is expected to provide an additional P5.88 billion to P17.6 billion in local property tax yearly.

The Valuation Reform Bill is seen to improve the valuation system in the country to ensure that real property contributes fairly to local and national revenues, Purisima added.

Purisima noted that while the country witnessed a tremendous real estate boom in the past several years, majority of the provinces and cities continued to use an outdated real estate valuation system in  collecting their real property tax, thereby failing to capitalize on soaring real estate prices.

“Even the collection efficiency is so dismal that the 10-year national average is only 57 percent and has never gone beyond 70 percent  of aggregate LGU collectibles,” Purisima said.

Aside from this, Purisima noted that idle land tax is also not widely used even in the most urban LGUs. “If LGUs could only update their SMVs properly and optimize collections, improve the tax records and database, enforce collections legally, the estimated annual incremental revenue is P10.8 billion to P12.03 billion – and municipalities and barangays will also get their fair share in real property tax,” Purisima  said.

“The basic education sector also stands to gain from this reform as they will get about half of these revenues from the Special Education Fund,” the Finance chief added.

Purisima likewise noted that revenue performance of locally sourced revenues of LGUs as a percentage of GDP had declined from 0.91 percent in 2009 to a preliminary ratio of 0.80 percent in 2012.   The year-on-year growth of local revenues also continued to slide from 11 percent in 2010 to one percent in 2012.

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Ayala Land to triple real estate portfolio by 2020

By Zinnia B. dela Peña (The Philippine Star) | Updated February 23, 2015 - 12:00am

MANILA, Philippines - Property giant Ayala Land Inc. (ALI) aims to triple its real estate portfolio by 2020 as part of an investment program to boost its net income to P40 billion in  the next six years.

In a briefing with analysts, ALI unveiled its six-year business plan which will see its inventory of shopping malls , office buildings and  hotel rooms grow threefold by 2020 from its 2013 capacity.

This translates to 3.6 million square meters of shopping space, 1.8 million sqm of office space, as well as 6,000 hotel and resort keys.

ALI, which developed the Makati business district, has  earmarked a record high P100.3 billion for capital spending this year to bankroll its  aggressive expansion program aimed at growing its net income by an average of 20 percent annually.

Of the total programmed budget, P37.4 billion will go to the construction of residential projects, P31.5 billion for land acquisition, P14.7 billion for new mall developments, P5 billion for new office buildings, P2.8 billion for hotels, and P8.9 billion for others.

Based on the current completion schedule, ALI will grow its office space by an average of 16.4 percent annually from 2014 to 2019. Shopping space is projected to expand 17.4 percent  annually from 2014 to 2017.

Hotel and resort keys are expected  to grow at an annual average of 14.4 percent from 2014 to 2019.  This includes 497,000 sqm of shopping center space, 693,000 sqm of office space, and 2,066 hotel and resorts keys.

ALI said most of the sites for these expansion are already in place, making these targets more feasible.

To support its robust growth trajectory, ALI will continue to launch projects aggressively as well as capitalize on its  8,639 hectares of landbank across the country.

Last year, ALI reported a net income of P14.8 billion or 26 percent higher than 2013 on the back of hefty revenues from its residential offerings and shopping centers.

ALI has five residential brands -- Ayala Land Premier which caters to the high end segment of the property market, Alveo (upper middle class), Avida (middle-income), Amaia (low-cost) and Bella Vita (socialized housing).

It  is the property firm of conglomerate Ayala Corp., which also has interests in  utilities (Manila Water Co. Inc.), telecommunications (Globe Telecom Inc.), semiconductors (Integrated Microelectronics Inc.), banking (Bank of the Philippine Islands), and education (LiveIt Investments), among others.

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PDIC sells P349m worth of properties

By Julito G. Rada | Feb. 23, 2015 at 11:01pm [ manilastandardtoday.com ]

State-run Philippine Deposit Insurance Corp. said it raised P349 million from the sale of corporate and closed banks’ real properties in 2014.

PDIC said in a statement Monday the number of properties sold last year reached 304.  These included 283 assets of closed banks which were sold for P236 million and 21 properties under corporate assets which generated P113 million.

“Properties sold through public bidding amounted to P142 million while P205 million were sold via negotiated sale as allowed under PDIC’s disposal policy,” the agency said.

The properties sold were from various locations in Metro Manila and the provinces of Albay, Baguio, Batangas, Bulacan, Cagayan, Cavite, Ilocos Norte, Laguna, Nueva Ecija, Pampanga, Pangasinan, Quezon, Rizal, Samar, Tarlac, Aklan, Camarines Norte, Camarines Sur, Cebu,

Negros Occidental, Negros Oriental, Sorsogon, South Cotabato and Lanao del Norte.

PDIC said it also generated P25 million from the sale of transportation and furniture, fixtures and equipment of closed banks.

“Proceeds from disposal of closed banks’ assets are held in trust for closed banks. As liquidator of closed banks, the PDIC is mandated to dispose and resolve the assets of closed banks and convert these to cash to settle claims of creditors as well as depositors with uninsured deposits, subject to the rules on concurrence and preference of credits,” it said.

Meanwhile, it said proceeds from the disposal of corporate assets were added to the Deposit Insurance Fund, the funding source for payment of deposit insurance claims.

PDIC is mandated to prudently manage and continuously build up the DIF to ensure it is able to respond to insurance calls in case of bank closures.

PDIC said it regularly conducted public biddings nationwide which were announced through its website as well as in national newspapers.

Assets not sold during public biddings are disposed through negotiated sale and other modes of asset disposal.

PDIC said this year, it would sell on an “as-is, where-is” basis various assets of closed banks with an aggregate minimum disposal value of P253.9 million in separate public auctions to be held in Davao and Makati City.

The first public auction this year would be held on Feb. 26 at Unit 80, 8th Floor, Landco-PDCP Condominium Building, Pryce Business Park, J.P. Laurel in Davao City.

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Robinsons wins Mitsubishi land

By Jenniffer B. Austria | Feb. 23, 2015 at 11:01pm [ manilastandardtoday.com ]

Robinsons Land Corp., the property arm of the Gokongwei group, has won the bidding for the 18.5-hectare property owned by Mitsubishi Motors Philippines Corp. along Ortigas Avenue Extension in Cainta, Rizal.

Robinsons Land president and chief executive Fredrick Go said in an interview at the sidelines of the company’s P12-billion bond listing at Philippine Dealing & Exchange Corp. the company was informed it had won the auction for the property.

“We were informed that we won the bidding of the Mitsubishi property. We are currently the largest developer in the eastern corridor and by getting the property, this adds to our landbank,” Go said.

Go said the financial closing for the property was expected over the next couple of months. He said Robinsons Land planned to develop the property into an integrated mixed-use township.

Go did not disclose the winning bid.

Meanwhile, Go said Robinsons Land planned to launch four or five projects this year across all brands, with sales value of P6 billion to P12 billion per project.

Robinsons Land launched P8 billion worth of residential developments in 2014.

Go said while the company continued to launch residential projects, it would be more aggressive with shopping malls, office buildings and hotel projects.

He said the outlook for the residential sector remained positive this year, given the strong demand for housing projects. He said there was also a lot of supply coming in from other property developers.

Robinsons Land allocated P17 billion in capital expenditures this year, primarily for the construction of malls, office buildings, hotels, residential projects and also for land acquisitions.

Net income surged 35.4 percent in the quarter covering October to December 2014 to P1.39 billion from a year ago, on rental income of shopping malls and office developments.

Consolidated revenues in the October-December period grew 9.1 percent to P4.78 billion from P4.38 billion posted in the same period a year ago.

Rental income rose 13.6 percent to P2.21 billion from P1.94 billion a year earlier, supported by strong revenues from shopping malls division which opened seven new malls in 2014.

Hotel operations rose 11.4 percent to P446 million from last year’s level of P401.2 million while real estate sales were flat at P1.6 billion.

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New malls, condo sales boost SM Prime Holdings’ profit

Posted on February 23, 2015 10:10:00 PM [ BusinessWorld Online ]

By Daphne J. Magturo, Reporter

 

SM PRIME Holdings, Inc. yesterday said its 2014 net income grew by 13% -- within the range of analysts’ estimates -- on the back of a double-digit growth in revenues.

In a statement, SM Prime said bottom line last year reached P18.4 billion last year, while revenue went up by 11% to P66.2 billion.

SM Prime President Hans T. Sy said in the statement: “We expect this performance to be surpassed this year as the company pursues its 2015 expansion plans.”

He was referring to four new malls to be opened this year, as well as the completion of FiveE-comCenter and the launch of five new housing projects.

“This is in line with our target,” Alexander Adrian O. Tiu, analyst at AB Capital Securities, Inc., said in a phone interview. He noted, however, that the results “slightly missed” the 13.6% market consensus from a Bloomberg poll.

Shares in SM Prime shed 28 centavos or 1.42% to close at P19.40 each yesterday.

The company’s rental revenues from retail and commercial spaces increased by 13% to P36.5 billion in 2014, the company said in the statement.

“Management attributed the increase in rental revenue mostly to the new malls that opened and the expansion of existing malls in 2013 and 2014, namely, SM Aura Premier in Taguig, SM City BF Parañaque, Mega Fashion Hall in SM Megamall in Mandaluyong, SM City Cauayan in Isabela province and SM Center Angono in Rizal province, which have a combined total gross floor area of 564,000 square meters,” SM Prime said.

The company’s housing group, which accounted for 33% of consolidated revenues, “continued to show improvements.”

The group recorded a 7% increase in real estate sales to P22.2 billion, “mainly driven by the increase in the pace of construction of sold units” in its condominium developments in Taguig, Pasay, Manila and Quezon City.

The malls’ cinemas grew their ticket sales by 14% to P4.3 billion.

“The increase was driven by the opening of additional digital cinemas in the new malls and expanded malls and by the launch of international and local blockbuster movies,” SM Prime said.

Together with amusements, cinemas account for 12% of SM Prime’s consolidated revenue for 2014.

                                                                                                                                        

The property developer’s consolidated costs and expenses increased by 8% to P38.6 billion last year.

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