JV MAGSAYSAY: The harbinger of agricultural real estate

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JV Magsaysay’s main field is in the wood industry—from timber production to wood plantation—having staked his own investment at the young age of 18

Jesus Vicente Magsaysay, or simply JV to his friends, is perhaps the most low-key among the members of his famous political family.

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His grand uncle, Ramon Magsaysay, was the seventh president of the Philippines and known as the People’s President; while his father, Vicente Magsaysay, was former governor of Zambales. His wife Mitos, too, is very active in the political scene, having served as representative of the 1st District of Zambales for three consecutive terms; just as other relatives continue to take part both in the national and local political scenes.

Nonetheless, running the name “JV Magsaysay” on the Internet will result in two prominent credentials—first as Honorary Consul of Papua New Guinea, and as a businessman involved in the timber industry.

 Outside his many businesses, JV describes himself as a ‘family man’ at the very core. He is proud of his 31-year marriage to former congresswoman Mitos Magsaysay with whom he shares a sizeable brood of six.

Outside his many businesses, JV describes himself as a ‘family man’ at the very core. He is proud of his 31-year marriage to former congresswoman Mitos Magsaysay with whom he shares a sizeable brood of six.

As The Sunday Times Magazine sat down for an exclusive interview with this third generation Magsaysay, it was apparent that he has chosen not to be involved in the family’s predilection, not once initiating any talk on politics. Unless directly asked about his views on public service, he is focused on discussing his rediscovered passion for agriculture.

Agri-man
It was only earlier this year that the local agriculture industry caught the interest of Magsayay anew. He explained that for a long time, the Magsaysays had owned cattle ranches and sugar plantations in Zambales.

“But my main field is really in the wood industry, from timber production to wood manufacturing,” explained the 52-year-old businessman. “And while my family took on this business in 1947, it wasn’t passed on [to me]as other may think. I staked my own [investment]in the timber industry at the age of 18 while I was still studying.”

 In February of this year, Woodrich Agri Technology Corp. was founded with by JV Magsaysay (second from left) and Cielo Petines (extreme left) along with international partners who attended their exhibition at Agrilink 2015

In February of this year, Woodrich Agri Technology Corp. was founded with by JV Magsaysay (second from left) and Cielo Petines (extreme left) along with international partners who attended their exhibition at Agrilink 2015

He vividly recalled, “I have to credit my grandfather for exposing and training me during my childhood, he made sure that I spent my summer school breaks in our family’s logging operations in Mindanao or our plywood and sawmill factories.

“Since I was exposed to this environment early, it became very tempting for me to start my own business. After high school, I began focusing on off sized timber but banks were at first hesitant to deal with a minor as expected. Luckily, after their scrutiny—when they found both my business and market viable—and with my dad’s consent, they agreed to support me.”

All the same, agricultural opportunities always opened for Magsaysay, perhaps in the same way that politics often opens doors for many of his relatives.

“When there was a closure of sugar central in Zambales and a log ban in 1993, I actually went full time in livestock. I did broiler [chicken]production on a commercial scale with around 700,000 heads, up until 1999,” he recalled. “After closing the broiler production, an opportunity for timber opened up in Papua New Guinea and I took it.”

As fate would have it yet another prospect opened up for agriculture during Magsaysay’s stay in southwestern pacific island. And as any astute businessman would do, he looked into its potential and decided on its viability.

Into Agco
Magsaysay came across an American umbrella enterprise called Agco GSI that is comprised of multiple companies that specialize in all aspects of the poultry and swine business. Able to create entire systems for this agricultural field, Agco has the capability to construct weather proof and climate-controlled housing for animals, and produce swine equipment, feeders, and water and ventilation systems, among others. They also carry the brands Cumberland for poultry business needs, and Valli, an Italian company specializing in the layer and broiler cage industry.

As Magsaysay discovered, Agco had already operated in the Philippines for 10 years until a competitor bought out its original local distributor, which resulted in management conflicts.

Impressed by the extensive range of services and products available through Agco, Magsaysay entered into a partnership with the former Philippine general manager of the company, Cielo Petines, and was officially granted the dealership in February.

 What a modern, comfortable and stress-free housing for agricultural animals looks like—as exhibited by Cumberland

What a modern, comfortable and stress-free housing for agricultural animals looks like—as exhibited by Cumberland

“My company, WATCO [Woodrich Agri Technology Corp.], now manages the dealership of Agco in the country,” he related. “And while we have carried all its existing products this year, we also have future plans of bringing in other products related to the industry like farm equipments, and eventually manufacture and assemble them in the near future.”

Excited by the possibility of streamlining agricultural processes in the country, Magsaysay, to say the least, has come to decide that among all his other investments, this one has most promise.

“The wood industry still has potential for some people because they are converting to tree farms or tree plantation, but with the magnitude in volume requirement we have for timber, the demand will always outgrow the supply. And for the Philippine scenario, I would rather go into agriculture because one would need huge tracks of land to make tree plantation viable,” he proposed.

Agri-real estate
Magsaysay is very bullish about the agriculture industry, having identified interested and willing investors in the sector. In fact, he encourages many other entrepreneurs to consider going into agricultural trade.

“A lot of banks now are very supportive of the livestock industry, and they are extending very favorable and friendly interest rates to producers,” he cited as an example.

“That’s also why equipment modernization for this sector is considered a sunrise industry, and why there is a growing demand for livestock farmers to expand their farms, and for those involved in real estate to build modern farms and have them rented.

“Rental would have a 25- to 27-percent return per year, as compared to idle money in the bank,” Magsaysay continued, churning up his research. “So even if you don’t grow anything, somebody is sure to rent your farm.”

The agri advocate then contrasted agricultural real estate with the popular investment nowadays of buying a condominium unit and having it rented.

“If you buy a condo and have it rented, you’re not sure if someone’s going to rent it all-year round. In agricultural farming, once a lease is taken on, the leaseholder has no choice but to grow livestock ensuring continuous production and rental at the same time,” he explained.

“And with the Philippines having a large population to feed, we have to produce more and more food for the people, so that the production side continues to grow as well.”

All the same, Magsaysay cautions those who are suddenly enlightened by his business model that they have to be sure to build the necessary foundation for agricultural production.

“To produce large quantities for the population, a grower must first establish a modern and reliable housing,” he emphasized. “This is the most basic in the livestock business—not the feed mill but the modern housing unit.”

 Cumberland’s automated nesting system provides efficient egg collection for poultry farmers

Cumberland’s automated nesting system provides efficient egg collection for poultry farmers

As the one-stop shop for such systems through Agco, Magsaysay advises interested investors—most likely returning Overseas Filipino Workers and retired professionals—who have some P20- to P50 million to put to good use to build modern farms and have them rented, rather than risking all their hard earned money in condominiums.

“This is the very reason I established Watco because I believe that modern livestock building is a very good business,” he enthused.

Beyond agri
Satisfied that he had explained his advocacy for agricultural real estate thoroughly, Magsaysay allowed The Sunday Times Magazine a peek into his personal life to round up this exclusive interview.

Outside of WATCO and Agco, he describes himself as a “family man” at the very core. He is proud of his 31-year marriage to former Representative Mitos with whom he shares a sizeable brood of six.

“We make sure that we all travel together at least once a year, although it’s harder to do now since my children all have their own lives,” Magsaysay chuckled.

Finally touching on political inclinations when asked why he never went into government, Magsaysay replied, “Politics is not a must in our family, and we never turned it into a ‘business.’ What is important for all of us is that whatever we do, we never destroy our name, and in whatever capacity we can, serve the Filipino people well.”

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