MANILA, Philippines - Megaworld Corp., the property development arm of the Alliance Global group of tycoon Andrew Tan, is spending at least P15.6-billion over the next 20 years to convert a portion of the northern district of Bonifacio Global City into a mixed-use complex, according to a disclosure it filed with the Philippine Stock Exchange.
The Bases Conversion and Development Authority (BCDA) has awarded to Megaworld the right to develop the 8.38-hectare North Bonifacio lot after matching the offer of its lone challenger, Robinsons Land Corp. (RLC) with its final bid of P37,603.69 per square meter a total amount of P3.151 billion.
Megaworld’s winning bid is slightly higher than RLC’s offer of P37,597.86 per square meter and 13 percent higher than its original bid of P2.78 billion.
Under Megaworld’s proposal, the BCDA shall be entitled to an upfront cash of P1.062 billion and annual revenues of P306,616.325 for 12 years.
Tan said the company is confident about the long-term development potential of the property and remains firmly committed to Bonifacio Global City as the upcoming premier central business district in the country.
The company’s proposal for the North Bonifacio lots is a mixed-use development of more than 500,000 square meters of gross floor area and is predominantly residential.
With a cash position of P15.7 billion as of end-June this year, Megaworld boasts of its strong capability to carry out large-scale property development projects. It has a successful track record of building self-contained communities under its pioneering “live-work-play-learn” concept.
In the first half this year, Megaworld reported a net income of P2 billion, up 12 percent from the same period a year ago. Consolidated revenues rose 16 percent to P8.73 billion, with real estate sales accounting for P6.07 billion or an increase of 15 percent from the year earlier level of P5.28 billion.
Megaworld currently has five townships within Metro Manila, as well as stand-alone projects in the Makati central business district. It has about 275,000 square meters of BPO office space and expects to complete another 60,000 square meters by yearend.
The company is launching five new residential condominium projects this year estimated to generate around P12 billion in sales.
Among these projects include Two Central (a prestigious high-rise building located in Salcedo Village that will make available around 400 units), Tower Three in Eastwood City in Libis, Parkside Villas (a seven-cluster community that will rise beside the five-star Marriott Hotel in Newport City in Pasay), The Venice Residences (a seven-tower residential project in Mckinley Hill in Bonifacio Global City), and Morgan Suites Executive Residences (also within the 50-hectare Mckinley Hill township).
Around 80 percent of the company’s sales come from residential projects while 10 to 15 percent come from lease operations.
Megaworld has set aside P8 billion to P10 billion for its capital expenditures this year, mostly to go to project development.
Part of the capex will be used to fund the construction of a new hotel under the Richmonde brand, in EastwoodCity.
The new four-hotel will offer a total of 100 to 150 rooms with the development cost pegged at $70,000 per room. A third branch of the Richmonde Hotel is also being planned in Manila’s Binondo district where Megaworld is building a township to be called Cityplace. – With Ma. Elisa P. Osorio