IT’S a strategy that listed mass housing firm 8990 Holdings Inc. is adopting to keep home prices low—developing properties in areas, where land is distributed to fewer owners.
Chief Executive Officer Januario Jesus Atencio said his company prefers to acquire properties in areas with less land distribution, as it is easier to build subdivision projects.
Atencio described Bacolod City, where 8990 has an upcoming project, as a unique place because of its lesser land distribution.
“Bacolod is a very unique place because large land holdings are owned by a few people like families,” he said. “So, madaling gumawa ng subdivision.”
Atencio pointed out that purchasing land from areas with too much distribution tend to make prices higher, since landowners have less land to sell.
“If I buy 10 hectares from you, that’s all you’ve got; that’s why prices tend to be higher,” he stressed.
On the other hand, he said, being able to acquire cheaper land allows the firm to offer projects at lower prices.
“You can have really good subdivisions at really low prices,” Atencio said.
8990 is set to build a project on a 40-hectare lot in Bacolod this year.
It also plans to build townhouses on a 13-hectare property it bought in 2014 from agricultural firm Vitarich Corp. in Marilao, Bulacan.
The listed mass housing firm booked a net income of P4.05 billion in 2015, which was P746 million more than its net of P3.31 billion in 2014.
For the fourth quarter alone, 8990’s net income surged 86 percent to P887 million from P477 million in the same quarter of 2014.
8990’s fourth-quarter sales shot up 67 percent to P2.59 billion from P1.55 billion in the comparative period in 2014.
The company said its 2015 gross sales rose 24 percent to P9.65 billion from the previous year’s P7.79 billion, driven by strong sales of its horizontal housing developments across the country.
8990 attributed its robust performance to its “strong presence, brand acceptance, building innovation and track record of housing delivery in the growth centers of the country—NCR, Angeles, Cebu, Iloilo and Davao.”