AboitizLand to expand industrial estate portfolio

MANILA, Philippines - The property arm of conglomerate Aboitiz Equity Ventures Inc. (AEV) is looking at expanding its industrial estate portfolio starting next year.

Aboitiz Land Inc. (AboitizLand), which is also pursuing public-private partnership (PPP) projects, is banking on foreign locators’ bullish outlook in the Philippines, its top executive said.

“We think that there’s going to be an opportunity for industrial parks. We sense there are many foreigners looking at the Philippines and many of them want to be in secured, prepared industrial estates with proper infrastructure,” AEV president and CEO Erramon Aboitiz told reporters.

The Philippines, given its robust corporate and macroeconomic fundamentals, secured investment grade scores from Fitch Ratings and Standard & Poor’s early this year. This bolsters the country’s attractiveness in the eyes of foreign investors.

“We’d like to see whether we can build (our industrial estates portfolio). Our thinking was it’s probably best to get to an existing one and then expand,” Aboitiz said.

So far, AboitizLand is conducting a due diligence in line with its plan to buy a 60-percent stake in Lima Land industrial park in Batangas, jumpstarting the company’s expansion outside the Visayas.

AboitizLand will finalize the deal towards the end of the month, Aboitiz said. Locators in industrial estates enjoy several perks like tax breaks.

Holding firm Alsons Consolidated Resources Inc., majority owner of the 485-hectare Lima Land, earlier said AboitizLand offered P1.5 billion for the industrial park.

Aboitiz said the company also has plans on putting up industrial estates in the other parts of the country but nothing is concrete at this point.

“It depends where we can find the property and where investors are,” Aboitiz said.

In its 20-year history, AboitizLand has been in the industrial segment as the company behind the Mactan Economic Zone II in Lapu-lapu City, and the West Cebu Industrial Park.

For next year, AboitizLand will be busy with expanding Lima Land and its existing industrial parks, Aboitiz said.

“We hope that we’ll be busy expanding our presence in Luzon,” he said.

Utilization rate for Lima Land is already high but there are still lots that can be developed and sold, Aboitiz said.

Outside of industrial estates, AboitizLand is also AEV’s vehicle for PPP projects.

“AboitizLand is the one bidding for the Mactan airport. We’ve also been looking at Cavite Laguna Expressway and maybe some other PPPs,” Aboitiz said.

The government will bid out this year the P17.5-billion Mactan-Cebu International Airport project that involves the rehabilitation, expansion and operation of the facility. AEV partnered with conglomerate Ayala Corp. for the bidding.

“Once we get that under our belt, we will be very interested in looking at other opportunities [for airport projects] around the country,” Aboitiz said.

Cebu-based AboitizLand plans to become a major income contributor to the Aboitiz conglomerate, which is predominantly into power generation and distribution.

In the first half, consolidated net income of AEV was flat at P11.9 billion compared with P11.8 billion a year ago. First semester core net income grew 3.5 percent to P11.7 billion.