CENTURY Properties Group Inc. (CPG) is looking at doubling its revenue and ramping up leisure and tourism-related developments via the six-year blueprint Century 2020.
“We expect to grow at least double by 2020 . . . in terms of revenue,” CPG President and Chief Executive Officer Jose E.B. Antonio told reporters after the company’s annual stockholders’ meeting.
By 2020, Antonio said the company’s revenue mix will be equally divided into a third each of commercial leasing, vertical residential condominium towers and horizontal residential units, and leisure and tourism projects.
The CPG president said the company will allocate “P6 billion to P8 billion a year for tourism” projects like hotel and integrated resorts, which is within Century 2020’s P10-billion yearly budget.
The Century 2020 blueprint is focused on diversifying its business by branching out to horizontal developments and focusing on leisure and tourism projects. The company also intends to increase its commercial retail and office line up apart from the current core business of vertical upscale projects.
“Since we believe that the positive structural story of Philippine real estate will continue to remain intact, we took great strides last year to craft our roadmap for the next five years. We aptly named our plan Century 2020, a plan that will allow us to shift our focus from top line growth to other important determinants of shareholder value,” Antonio said during the stockholders meeting.
“We are in the process of diversifying into allied real estate segments to further strengthen our portfolio. We will continue our vertical developments and investment properties businesses, but will soon venture into horizontal developments for firsttime home buyers and leisure and tourism development estates,” he added.
Under the Century 2020 plan, Antonio said P12 billion will fund the horizontal development of 20,000 homes for first time buyers, P10 billion for investment properties and P5 billion for vertical developments and leisure and tourism.
The horizontal development is going to happen in particular locations in Cavite, Laguna and Batangas.
The tourismrelated developments is the centerpiece of the company’s 2020 plan, particularly the 56hectare integrated resort project in San Vicente, Palawan and the 310room Novotel Suites Manila – a tie up with AccordHotels. The Novotel project was launched on Monday.
“In line with the strength of the economy, as wages and disposable income levels rise, so does spending on tourism…We view tourism as one of the low hanging fruits of the Philippine economy. The country has an abundance of tourist attractions, a rich culture, and natural propensity for service and hospitality. We believe that the tourism industry still has a lot of potential to catch up with powerhouses such as Thailand, Singapore, and Malaysia,” Antonio said.
“In line with the growth in the economy, rising incomes and low interest rates have created a surge in the number of firsttime home buyers. As we did in our vertical developments, we are looking to be a key player in the horizontal developments space. We estimate that these projects can provide higher margins that will result in a higher return on invested capital and the shorter turnaround of the projects will provide us higher internal rates of return,” he added.
The Novotel Suites Manila is located in the company’s 2.5hectare Acqua Private Residences in Mandaluyong City, and is expected to be completed by 2019, said CPG Chief Operating Officer Marco R. Antonio.
The 41storey hotel will be the sixth tower in the Acqua complex.
Under the partnership, the hotel’s 310 rooms will be divided into 158 CPGowned units, and 152 AccordHotels units under the “Fractional Ownership Program (FOP).”
The FOP is a system of owning units through the purchase of AccordHotel preferred shares. The starting price of a unit under FOP is P2 million, which entails a 28-day stay each year in Novotel Suites Manila.
The units under FOP are equivalent to 608 preferred shares, which means that the P2-million price tag of a Novotel unit translates to four preferred shares of AccordHotels.