Hefty revenues from leasing its office and retail portfolio pushed the bottom-line of listed property major Megaworld, owned by ethnic Chinese tycoon Andrew Tan, in this year’s first quarter, a sign of brisk business in the real estate market.
The Philippines’ leading and the no. 1 office developer and landlord, Megaworld posted a 49-percent jump in net income to P2.69-billion, year-on-year, due to strong sales in its various townships, particularly Newport City, Uptown in Bonifacio, McKinley Hill and Eastwood City.
“As we celebrate our 25 years in the real estate industry, we look forward to another record breaking year for Megaworld,” says Tan in a statement to the Philippines Stock Exchange.
Megaworld’s rental income from office developments and lifestyle malls also surged to a record P1.7 billion, 23 percent higher than in the same period in 2013.
Total revenues of Megaworld, together with its subsidiaries Empire East Land Holdings and Suntrust Properties, rose 22 percent to P9.94 billion for the first quarter 2014, up from P8.15 billion for the same period in 2013.
Megaworld, and its subsidiaries, posted P19.6 billion in reservation sales in the first quarter 2014 which is 9 percent higher compared to same period last year.
Just last week, the company announced the planned consolidation of Tan’s real estate companies under Megaworld with the acquisition of 49.2% stake of Alliance Global Group, Inc. in Global-Estate Resorts, Inc. (GERI).
The acquisition brings Megaworld’s majority stake in GERI to 74.96% and increases the property giant’s total land bank to more than 3,900 hectares.
Megaworld is also set to further solidify its position as the leader in office developments in terms of total office space inventory by completing another 112,000 square meters of office spaces this year. By the end of 2014, the company will have around 712,000 square meters of office spaces in its portfolio with the completion of new state-of-the-art office towers in Uptown Bonifacio, The Mactan Newtown in Cebu, and Iloilo Business Park.
On the retail side, Megaworld is also set to complete additional commercial and retail spaces with the completion of the Venice Grand Canal Mall in McKinley Hill, and some commercial strips at The Mactan Newtown.
No. 1 in real estate
Megaworld’s existing commercial and retail space portfolio is currently at 304,083 square meters.
To date, the company has 10 townships all throughout the country covering around 300 hectares of land. This includes the 17-hectare Eastwood City, considered to be the country’s first cyberpark.
Over the past 24 years, the Megaworld Group has emerged as the country’s No. 1 real estate organization. It has completed more than 320 residential and office buildings with a total area of around 5.6 million square meters.
Currently, about 185 residential, office and hotel buildings with a total area of around 5.4 million square meters are under development.
Megaworld is also expanding Eastwood City, its first township in the Philippines and the country’s first cyberpark, to an additional 1.5 hectares amid growing demand for office and commercial spaces in the township.
“The tremendous success of Eastwood City as the country’s first cyberpark and premiere township has attracted thousands of Filipinos to live here,” says Tan.
At least three office towers are in the expansion pipeline. First to rise will be a high-rise mixed-use tower that combines residential, office and commercial in a cluster.
The company is projecting to accommodate around 100,000 square meters of office spaces that will be built progressively over the next few years and around 600 residential units in the Eastwood 1.5-hectare expansion plan. All towers will have leasable commercial spaces at the ground levels.
“With the expansion, we are looking forward to a more exciting mix of new commercial and retail partners in this new side of Eastwood City,” says Kevin L. Tan, first vice president and head of commercial division, Megaworld.
Home to IT workers
To date, Eastwood City is home to an estimated 60,000 IT and BPO workers in 59 companies, making it the biggest cyberpark in the Philippines in terms of workforce. It is also home to around 25,000 residents and about 500 commercial and retail partners.
Established in 1999, Eastwood City is one of Megaworld’s most successful townships that pioneered the “live-work-play” lifestyle concept in the Philippines. It is a testament to how far a developer can do when it comes to marrying urbanization and sustainability.
The township currently has 10 office buildings, mostly occupied by some of the country’s biggest IT-BPO companies, 19 residential condominium towers, three Megaworld lifestyle malls (Eastwood Mall, Citywalk 1 & 2 and Cyber & Fashion Mall) and the Eastwood Richmonde Hotel.