Allots P30B capex for future projects
LISTED property developer Megaworld Corp. said on Friday it is targeting P90 billion worth of reservation sales this year on the back of robust demand in the property market.
“Last year, we reported a target of P80 billion [reservation sales]but we’ve hit P87 billion. This year, our target is P90 billion,” Megaworld Corp. Senior Vice President Jericho Go told reporters following the company’s annual stockholders’ meeting held in Quezon City.
“So far, we are on track in terms of reservation sales,” he added.
Megaworld is also targeting to generate about 1 million square meters (sqm) for office spaces, while 300,000 sqm will be for retail spaces.
“Basically by the end of this year we’ll be producing 1 million [sqm]of office space, and then retail roughly at 300,000. And then by 2020, our target is that … 1.5 million sqm will be produced for office and then half a million for retail. By then, roughly, it would be a combined 2 million sqm both for office and retail,” Go said.
For this year, Megaworld is allotting P30 billion capital expenditure for its future projects, of which P5 billion has already been officially earmarked.
Just recently, Megaworld launched the establishment of its newest township in San Fernando, Pampanga, the Capital Town, which will be its “first township in the north.”
The Capital Town will rise on a 35.6-hectare property at the former site of the historic sugar central of the Pampanga Sugar Development Company (Pasudeco).
“With regards to the location of the [remaining]P25 billion, it will be mixed again. So we’ve said there’s Pampanga, Iloilo, Fort Bonifacio, several others, so it will be—Cavite also—all residential,” Go said.
“We mentioned the value because the projects, it cannot be just project-based because if it’s one location, you can be more dense—if in Fort Bonifacio it can be higher density—higher value—so we expect to be able to reach that amount of P30 billion. So it can potentially be more,” he added.
He said one of the key factors is the peso-dollar rate, with the dollar now hovering at from P49 to P50.
“The overseas remittances can help fuel growth out there, you have a stronger dollar value now that’s being earned externally by the Filipino expats. And we know for a fact that roughly 50 percent of whatever is being remitted goes into real estate-related transactions,” the senior vice president said.
Go went on to say that the residential property market continues to show good promise.
“It’s very strong right now. I think, again, the value of the dollar increasing vis-a-vis the peso can partially be attributed by that robust demand for residential,” he said. “Maybe now is the best time to send money back for them to buy” real estate, he added.
Megaworld is the property arm of tycoon Andrew Tan under his umbrella conglomerate Alliance Global Group, Inc.