Posted on October 20, 2015
10:11:00 PM [ BusinessWorld Online]
By Daphne J. Magturo,
Reporter
PRIME Orion Philippines,
Inc. is converting Tutuban Center in Divisoria into a mixed-use development and
is doubling its leasable area, using Ayala Land, Inc.’s P5.6-billion
investment.
“Tutuban will be changed
into a master-planned development, a station where the south and the north
lines will meet and coordinate,” Prime Orion Chairman Felipe U. Yap told
reporters on the sidelines of the company’s annual stockholders’ meeting
yesterday at the Makati Shangri-La Hotel.
Prime Orion is improving
the mall complex to accommodate the transfer station of the P287-billion
North-South Commuter Rail project, which will have a 56-kilometer (km) commuter
rail from Tutuban to Calamba, Laguna, and a 478-km long haul rail from Tutuban
to Legazpi, Albay.
The rail project is
expected to boost the area’s daily foot traffic by 400,000 from the current
100,000.
“It will cater to the same
kind of market, but it will have some improvements where the people will enjoy
more privileges for the same price,” Mr. Yap said.
In August, Ayala Land said
it is infusing P5.6 billion into Prime Orion in exchange for a majority stake
in the company.
“It seems to me that the
entire proceeds will be quite sufficient...to finance the project... but we
don’t know until we get there,” Mr. Yap said.
Tutuban Complex, which sits
on a 20-hectare property, currently has a 60,000 square meter gross leasable
area that generates P400 million in annual revenue. The leasable area “can be
more than double” once the the expansion is completed.
“If there are no regulatory
requirements that will delay the project, as long as it’s within our control,
then [we will do it] as quickly as possible,” Mr. Yap said.
Ayala Land is set to
finalize the plan by mid-November, Prime Orion Corporate Secretary Daisy Parker
said in the same event.
The property will likely
have residential and commercial components, although it will “depend on the
concept of Ayala,” he added.
Yesterday, Prime Orion’s
shareholders approved Ayala Land’s subscription to 2.5 million common shares
that are equivalent to a 51.36% stake. To accommodate the subscription, they
also cleared the increase in Prime Orion’s authorized capital stock to P7.5
billion from P2.4 billion.
“The [annual leasing
income] will grow very fast,” Mr. Yap said. “There is speculation that the
market will be friendly and welcoming to a new development. We feel that we’re
starting from the bottom and the entry of Ayala is very positive to us.”
Prime Orion’s shares shed
six centavos or 2.96% to close at P1.97 apiece yesterday, while those of Ayala
Land lost 55 centavos or 1.55% to P34.85.
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