By JAMES A. LOYOLA
Rejuvenated developer Ortigas Land Inc., now controlled by the SM and Ayala groups, is allotting ₱15 billion to ₱20 billion annual capital expenditures over the medium term in order to spur strong growth for the next five years.
In an interview, Ortigas Land President Jaime Ysmael said the company hopes to continue posting “double-digit” growth as it expands its developments in Metro Manila.
The company earned a net income of ₱2.3 billion last year from just ₱100 million in 2014.
Ysmael said “there are many opportunities in the market which they can tap for earnings growth particularly the recurring income side of the business which is seen to contribute more in the coming years.
Currently, 70 percent of the company’s revenues is coming from property development projects which produce residential units and office spaces for sale.
“Eventually, as the new malls and offices come on stream, hopefully the percentage will reverse,” said Ysmael.
Ortigas Land eyes to invest between ₱15 billion and ₱20 billion for capital expenditures in the medium term in order to sustain the company’s growth. Ysmael said this should be enough to launch two to three projects a year.
“Hopefully more, if we could get more landbank in other areas. But we intend to still continue ramping up to the extent the market is ready. That’s why we want to be in a push button mode,” said Ysmael.
Last week, Ortigas Land unveiled the Residences at the Galleon — the residential component of its The Galleon mixd-use development in Ortigas Center.
The ₱16 billion Residences at The Galleon will consist of 51 floors with 43 residential floors, one amenity floor, five floors of podium parking, two floors of podium retail and 43 retail units.
It is the first of three projects Ortigas Land plans to launch this year.
Ysmael said the property sector continues to enjoy good fundamentals despite current challenges.
“There will be hiccups along the way but nothing major. We believe that, as long as the Philippine economy continues to grow at around the 5 to 6 percent level, we should still be okay as a country… generally the Philippines still has a lot of advantages,” he said.