8990 Holdings tops Pag-IBIG loan takeouts in first half

MANILA, Philippines - Mass housing developer 8990 Holdings Inc. has become the largest developer-partner of the Home Development Mutual Fund (Pag-IBIG Fund) taking out more than P1 billion in loans from the state-owned agency in the first half of the year.

The new housing rules and lending programs of Pag-IBIG Fund will provide faster and more efficient housing loan services to potential homebuyers, 8990 Holdings said yesterday.

In the first half, 8990 Holdings topped the list of Pag-IBIG Fund’s developer-partners with P1.12 billion in loan takeouts composed of 1,335 accounts, followed by New Apec Development Corp. with P669 million and Homemark at P569 million. Pag-IBIG’s allocation for individual housing loans this year is at P50 billion.

 “We are glad to be back with the Fund and we look forward to Pag-IBIG’s new housing policies and lending programs,” said 8990 Holdings president and CEO Jesus Atencio.

He said the housing provident fund’s special arrangements with other government agencies such as the Land Registration Authority and the Bureau of Internal Revenue “will provide faster and more efficient housing loan services to Pag-IBIG members and developer-partners.”

“The P1-billion take-out of our contract to sell (CTS) receivables through Pag-IBIG shows that 8990 Holdings’ business model works,” Atencio said.

In 2011, Pag-IBIG Fund tightened its housing loan policies following the discovery of alleged anomalies by Globe Asiatique Realty Holdings Corp., whose officials were charged with syndicated estafa.

“We hope that this allays whatever concerns the market has over our ability to effectively manage our receivables portfolio,” Atencio said.

In response to the tightening, 8990 Holdings launched the CTS Gold in-house financing facility that featured a two-percent downpayment and other policies similar to the Pag-IBIG’s housing loan guidelines: a low interest rate starting at 8.5 percent, 25-year loan terms and a monthly amortization cap of 40 percent of net disposable income.

“We patterned our in-house financing program as close as possible to the Fund’s guidelines because we wanted the eventual migration of our buyers to Pag-IBIG as seamless as possible,” Atencio said.

8990 Holdings’ CTS-Gold program has since grown to P11.5 billion. As of end-2013, 4,968 accounts equivalent to about P4 billion worth of CTS from the low-cost housing developer’s various projects in Angeles, Lipa, Cebu, Iloilo and Davao were migrated to Pag-IBIG.

“We continue to explore new avenues of housing finance such as take-out arrangements with banks like our agreement with CBTC Bank for a P1-billion facility on a non-recourse basis,” Atencio said, adding that 8990 Holdings is also looking at the securitization of P1 billion worth of CTS.

The listed property developer targets to sell nearly P70 billion worth of low-cost housing units nationwide in the next five years. The firm has a pipeline of 18 projects totaling 64,405 housing units in 250 hectares of landbank.

8990 Holdings is one country’s top mass housing developers, having sold more than 26,000 units from completed and ongoing projects. It operates through the Deca Homes brand for horizontal projects and Urban Homes brand for vertical projects.

8990 Holdings will launch 8,600 to 9,000 residential units this year, which will allow the company to book P3.2 billion in net income, up from P2.18 billion in 2013.

In the first quarter, its earnings jumped 30 percent to P933.6 million from P716.7 million a year ago. Sales climbed 22.3 percent to P1.92 billion from P1.57 billion in the same period last year.