ALI launches pioneering Homestarter Bond program

In a pioneering move, Ayala Land Inc. (ALI) has launched the Homestarter Bond which allows prospective investors to save up for homes offered by the property giant and its subsidiaries Community Innnovations and Avida.

The bonds are to be issued in tranches over 36 months. The first tranche involves P252 million worth of bonds to be sold at 100 percent of face value and will carry a guaranteed interest on principal amount at the rate of five percent per annum.

ALI president Jim Ayala said the Homestarter Bond is an investment tool that fasttracks prospective investors’ ownership of a prestigious and affordable property from the Ayala Group.

For as low as P5,000 up to P25,000 a month for only three years, the Homestarter Bond will grow to an amount enough for a downpayment on a condominium unit or a home, Ayala said.

The funds built under the program will earn a non-compounding interest of five percent a year, payable in three years. The investor may either apply maturity value plus a bonus as downpayment for any property developed by the Ayala Group or get his or her money back.

The program also provides a bonus credit of 10 percent on the total principal invested. This 10 percent bonus is added on to a client’s downpayment of the ALI property.

Ayala said the Homestarter Bond is mainly targetted to benefit the middle income market, particularly those who avail of traditional bank products such as savings account or time deposit.

Studies indicate that while many prospective buyers have the capacity to cover monthly payments for home loans, many find difficulty in raising the initial downpayment.

Interested investors are advised to visit any Bank of the Philippine Islands (BPI) branch nationwide.

Monthly payments shall be collected using BPI’s automatic debt system.

Investors, however, can only apply a maximum principal amount of P900,000 per property.

BPI Capital Corp. is the issue manager and underwriter for the planned bond flotation.

Proceeds from the issuance will be used to fund general corporate purposes.

ALI, which builds upscale malls, high-rise offices and residential developments, continues to pursue growth opportunities including new products and projects in new geographic areas and markets.

When completed, these projects are expected to significantly augment the company’s recurring revenue stream.

Among these new projects include the development of the 200,000-square meter North Triangle Commercial Center which is slated for completion by mid-2007; the expansion of Market! Market!; the Anvaya Cove in Morong, Bataan, a residential and beach resort community; and new residential subdivisions to cater to the middle-income market.

The company has also started development of its first real estate venture in Manila through its partnership with the Manila Jockey Club Inc.