ALI to pursue bond sale of Avida, Alveo units

MANILA, Philippines - Property giant Ayala Land Inc. (ALI) will pursue the bond sale of two of its housing units, marking the first time privately-held firms are tapping the debt capital market.

“Eventually, in the medium term, I do believe they (Alveo Land Corp. and Avida Land Corp.)  are ripe to do their capital raising in the debt market so we will continue to pursue that,” said ALI chief finance officer Jaime Ysmael.

“We will see, depending on how the Securities and Exchange Commission (SEC) responds,” he added.

In October, ALI issued P6 billion worth of bonds, completing the property firm’s P21-billion multi-series bond offer that would finance its huge capital spending program.

ALI sold P4 billion bonds due 2020 and P2 billion bonds due 2033 as unlisted subsidiaries Avida and Alveo have yet to secure SEC approval to raise funds from the listed debt capital markets. The two units are wholly-owned subsidiaries of the property giant.

“But so far, we already addressed (Avida and Alveo’s) financing requirements,” Ysmael said.

ALI is operating under five major brands: Ayala Land Premier for the upscale segment, Alveo Land for the upper and middle-income sector, Avida Land for affordable housing, Amaia Land for economic housing, and BellaVita for socialized housing.

Last year, ALI earmarked P65.5 billion for the completion of ongoing developments and the launch of 69 new projects with a combined value of P129 billion.

ALI will spend around P70 billion this year as the company is supported by strong macroeconomic fundamentals highlighted by continuous growth of gross domestic product, consumption, business process outsourcing sector and tourist arrivals.

In January to September last year, ALI’s earnings jumped 30 percent to P8.6 billion, driven by the upbeat performance of its property development, commercial leasing and services businesses.

The recent data puts the company closer to hitting the P10-billion income target, a year ahead of the completion of its five-year growth plan.

The property firm is wrapping up its 5-10-15 program, launched in 2009 amid the global financial crisis. It is a five-year plan ending in 2014 that aims to boost net income of ALI to P10 billion and return on equity to 15 percent.