Aiming for P20B by 2020
PROPERTY developer Megaworld Corporation exceeded its rental income target in 2016 on strong demand for office space, boosting the company’s confidence it is getting closer to its 2020 goal of growing its rental income to P20 billion.
In an interview on Wednesday, Megaworld Senior Vice President for Business Development and Leasing Jericho Go told The Manila Times that the firm’s rental income last year surpassed its P10 billion target.
“We will release the final figures, we did not only meet it [target], we exceeded it,” Go said.
In the first nine months of 2016, Megaworld said rental income rose 15 percent P7.41 billion from P6.44 billion in the previous year.
“I think by the end of the year, we should be hitting the one million mark [square meter mark]for offices. And this is what’s going to help us achieve that target of 2020, the P20 billion,” Go said.
By 2020, the company expects to have around 1.5 million square meters of office space in its portfolio. It is targeting to raise its rental income to P20 billion in 2020, which is more than double its P9 billion rental income in 2015.
In a statement on the same day, Megaworld said that in the next three years, it will be completing close to one million square meters of fresh rental inventory, mostly office, lifestyle malls and commercial spaces, around its 22 townships and integrated lifestyle communities across the country.
“This will bring the company’s total rental space inventory to more than 2.5 million square meters by 2020,” Megaworld said.
Megaworld currently has over 130 companies in its office rental portfolio, occupying around 850,000 square meters of office spaces. It said demand for office space is strong, as shown by the 99 percent occupancy rate of its offices and the 80 percent average pre-leasing rate of its office buildings under construction.
Its retail portfolio also contributes to its rental income. Megaworld said it expects to add 200,000 square meters of gross floor area to its retail portfolio this year as it opens new commercial and retail spaces at The Mactan Newtown, Iloilo Business Park, Southwoods City, Uptown Bonifacio, McKinley West, ArcoVia City and in some of its properties in Makati CBD.
“We have experienced an influx of people visiting our townships because our lifestyle malls also become leisure attractions like the Venice Grand Canal,” Megaworld Lifestyle Malls head and Senior Vice President for commercial division Kevin Tan said.
In the last two years, Megaworld has added 300,000 square meters of GFA to its retail and commercial spaces portfolio as it opened seven new malls and commercial centers — Uptown Mall, Uptown Parade, Venice Grand Canal Mall, Twin Lakes Shopping Village, Festive Walk Parade, Burgos Park and Eight Forbes Town Road, both in Forbes Town.
An additional 390,400 square meters of fresh retail space will be added to its portfolio by 2020 with the completion of 18 new malls and commercial centers in its various townships.
“This will bring the company’s total commercial and retail space inventory to 1.17 million square meters covering a total of 30 lifestyle malls and commercial establishments nationwide,” the company said.
In the first nine months of 2016, Megaworld said its net income grew 11 percent to P9.27 billion from P8.35 billion recorded in the previous year.