Posted on January 05, 2016
10:44:00 PM [ BusinessWorld Online ]
By Krista A. M.
Montealegre, Senior Reporter
DOUBLEDRAGON Properties
Corp., the real estate firm owned by the founders of Jollibee and Mang Inasal,
may hit its target to build 100 branded community malls ahead of its 2020
target, a top official said on Tuesday.
AN ARTIST’S concept for a
CityMall. -- WWW.FACEBOOK.COM/DOUBLEDRAGONPROPERTIESCORP
DoubleDragon Chairman and
Chief Executive Officer Edgar Sia II told reporters the company will spend an
annual P10 billion until 2017.
The developer hopes to
close 2016 with 30 CityMalls, with 25 outlets to be opened in addition to the
five that started commercial operations last year.
“If we open at this pace of
25 [CityMalls] a year, hopefully if we maintain that pace, that’s 2019. At
least we have a one-year buffer with our 2020 goal,” Mr. Sia said.
By 2020, DoubleDragon plans
to build a recurring income portfolio with a total leasable space of one
million square meters mainly through its 100 CityMalls, envisioned to be the
country’ largest chain of branded community malls.
Other sources of leasing revenues
will come from the DD Meridian Park, a 4.8-hectare (ha) mixed-use development
in Pasay City, and the Jollibee Tower, the future headquarters of the Jollibee
group in Ortigas.
Rental income from these
projects will allow DoubleDragon to reach a net profit of P4.8 billion by 2020,
Mr. Sia said, noting that the leasing business will start contributing
significantly to net income and revenues this year.
“Our goal is to have 90% of
revenues and net income by 2020 come from recurring sources,” Mr. Sia said. The
company is no longer looking at acquiring residential projects after taking
over existing developments in the past several years.
CHALLENGES
DoubleDragon has secured 41
sites in second- and third-tier cities for its CityMalls, ranging from 1- to 1.5-hectares
in size, Mr. Sia said, adding that landbanking has become more challenging amid
increasing competition from other property firms.
“We’re continually
acquiring sites because we build our barrier by acquiring the last remaining
prime properties. It’s not easy [to buy land but] if it’s difficult for us, it
will be impossible for the next one,” he said.
The five CityMalls in
operation are located in Roxas City, Capiz; Jaro, Iloilo City; Consolacion,
Cebu; Tetuan, Zamboanga City; and Imus, Cavite.
Asked to comment on the
performance of its first five CityMalls, Mr. Sia said: “I think it’s aligned
with our expectations. As per our vision, CityMall will eventually become the
center of gravity of the towns and cities where we build.”
Meanwhile, shareholders of
DoubleDragon approved yesterday the amendment to its Articles of Incorporation,
boosting the authorized capital stock of the firm to P20.5 billion from P500
million.
The capital stock hike will
set the stage for the creation of preferred shares, which will be issued in
“March or April,” Mr. Sia said.
DoubleDragon plans to raise
P10 billion from the sale of 100 million non-voting preferred shares at P100
apiece. The proposed equity offering includes an oversubscription option of up
to P5 billion.
Proceeds from the share
sale will be allotted for the development of CityMalls, DD Meridien Park, and
the Jollibee Tower, Mr. Sia said.
DoubleDragon is a joint
venture between Injap Investments, Inc. of Mr. Sia -- the founder of the Mang
Inasal grilled chicken restaurant chain -- and Honeystars Holdings Corp. of
Tony Tan Caktiong, chairman and founder of Jollibee Foods Corp.
Shares in DoubleDragon lost
30 centavos or 1.24% to close at P23.95 each on Tuesday.
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