The publicly-listed property developer said in a report that apart from the sale of office spaces in the high-rise UrbanBank Plaza along G. Puyat Ave. in Makati, it has been offering for sale other properties owned by the company.
"While these other assets involve huge amounts of money, we are lucky that these properties are spread out and hopefully the marketability of one or two of these would come ahead of the others," URDI said.
The company said the proceeds from the sale will be used to retire existing debts and improve their cash flow, "more than anything else."
URDI’s outstanding liabilities stood at P1.529 billion as of end-March 2001, with notes payable alone accounting for P1.253 billion. The company said their loan exposure would be substantially reduced if it would be successful in the disposition of its existing office space inventory and some of the real estate assets.
Its real estate assets are valued at P1.938 billion, or 71 percent of its total assets of over P2.742 billion.
In the first three months of 2001, URDI remained in the red with a higher net loss of P26.6 million, from P22.29 million a year earlier, mainly due to higher expenses of which 76 percent is channeled to finance and interest charges on loans carried by the company.
Despite the slump in demand and oversupply of office spaces, specially in the premium grade type, along with the decline in lease rates, URDI’s revenues during the first quarter went up 34 percent to P13.234 million, with rental income making up for a big chunk of 89 percent.
However, the company said it cannot rely on lease rentals alone; it must sell its real estate-related assets so that it can substantially reduce its debt.
"Our strategy continues to be to aggressively sell office space in the UrbanBank Plaza. This will not only translate to gains from the sale but will result to a reduction in the company’s dent and a corresponding reduction in interest expense," the company said.