Manila Bulletin – Real estate giant Ayala Land, Inc. (ALI) has
raised P13.6 billion, through the placement new ALI common shares, to
fund its expansion program including land banking and the planned
acquisition of a stake in the Ortigas family’s OCLP Holdings Inc.
The placement was conducted via an overnight bookbuilt offering
structured as a top-up placement. This landmark transaction represents
the largest overnight placement by a real estate company in Southeast
Asia since 2005, as well as the largest ever overnight placement in the
Philippines.
To implement the placement, parent company Ayala Corporation sold 680
million of its existing ALI common shares to qualified buyers and
institutional investors at P20 per share, and ALI concurrently issued
680 million new primary shares to AC at the same price.
Following this transaction, Ayala’s stake in the voting stock of ALI
will be marginally reduced from 73.07 percent to 71.22 percent and its
ownership in ALI’s common stock will be reduced from 53.06 percent to
50.43 percent.
The transaction was initially launched as a top-up placement of 530
million shares at an indicative price range of P19.80 to P20.20 per
share.
Due to strong demand and the fact that the offer was several times
oversubscribed, the company decided to increase the offer size to 680
million shares.
“We are delighted with the investor community’s continued strong
support of Ayala Land. This capital raise builds on the Company’s recent
performance and positions us well to capture the attractive real estate
growth opportunities we see throughout our country,” said ALI chairman
Fernando Zobel de Ayala.
ALI will use the proceeds of the share placement primarily to fund
its next phase of expansion, enabling it to sustain its high-growth
trajectory.
In addition to its P37-billion capital expenditure program for 2012,
ALI has identified significant land banking opportunities amounting to
about P36 billion over the next two to three years.
About P20 billion of this may be deployed in Makati City and other
parts of Metro Manila and the balance in growth centers in Nuvali and
other parts of Luzon and in the Visayas and Mindanao.
A portion of the proceeds is also expected to partially fund ALI’s
potential strategic alliance with a group led by Ignacio R. Ortigas and
resulting participation in OCLP Holdings, Inc., the parent company of
Ortigas and Company Limited Partnership.
ALI has budgeted an initial investment of P15 billion for this
alliance which is expected to provide ALI with access to about 55
hectares of prime properties in Metro Manila.
“We are on track toward achieving our ‘5-10-15’ plan by 2014. This
equity raise provides Ayala Land with expanded permanent capital to
support our long term growth plans,” said ALI president Antonino T.
Aquino.
Goldman Sachs (Singapore) Pte., J.P. Morgan and UBS Investment Bank
acted as Joint Bookrunners and Placement Agents in connection with the
Placement. BPI Capital Corporation acted as Sole Domestic Coordinator
and Bookrunner, and CLSA Limited Acted as Co-Manager.
Sunday, July 22, 2012
Property boom transforming Philippine skylines
AFP - As a
Philippine property boom gathers pace, even Paris Hilton, Donald Trump
and high-fashion house Versace are getting a piece of the action.
The good times are into their fourth year, fuelled by steady economic growth, Western firms offshoring jobs to the Philippines, the buying power of millions of Filipinos working abroad and low interest rates.
"It just so happens that today the stars are aligned... we have never seen the economy this bullish," said Antonino Aquino, president of Ayala Land, one of the country's biggest property developers.
Ayala Land is one of the main players in what industry figures describe as an unprecedented construction boom that is transforming the skyline of the nation's capital, as well as many provincial cities.
In Manila, formerly sleepy pockets such as the Fort army base and the rundown Eastwood industrial zone have become chic, new business districts, catering mainly for the fast-growing outsourcing sector.
At the Fort, Ayala Land this year broke ground on its US$714-million One Bonifacio High Street project, which when completed in 2017 will host the Philippine Stock Exchange, a Shangri-La hotel, and retail outlets.
The project also has a 63-storey residential tower, with 298 suites ranging from US$500,000 to US$1.9 million that sold out last month in 96 hours, according to the company.
Across the country, more than 850,000 square metres (9.1 million square feet) of office space and 14,000 residential units will enter the market this year, property consultants CBRE Philippines said in a report.
It said many of the residential units catered for a growing middle-class on the fringes of Manila and other urban centres.
The building boom has also spread to hotels, shopping malls and casinos, triggering hopes of a long-anticipated take-off of the underdeveloped tourism industry.
Three of the world's biggest gaming industry leaders are building a US$4-billion, 100-hectare (247-acre) Entertainment City complex of casinos on Manila Bay. The first of the casinos are set to open early next year.
Meanwhile, Trump, the New York mogul, has put his name to a US$150-million, 56-storey, curtain-glass-walled Trump Tower that broke ground in the financial district this year.
"High-end buyers look for key differentiated features," said Robbie Antonio, managing director of Century Properties that is behind the Trump Tower development.
He said 70 percent of the 220 residential units, which are worth up to US$1.86 million each, have been sold.
The firm is putting up a nearby tower designed by the Versace fashion house -- the first of its kind in Asia -- featuring individual wading pools as well as its iconic Medusa-head brand imprinted on lamp shades and cutlery.
Century also flew in socialite and hotel heiress Hilton to Manila last year to help design and promote a suburban Manila residential project that features a man-made beach.
Industry players say the property boom reflects the overall status of the nation's economy as it picks up steam after decades of underperforming compared with many of its Asian neighbours.
The economy grew 6.4 percent in the first quarter, the stock market has surged 20 percent this year to hit all-time highs, and the country's credit rating has been bumped up to just a step below investment grade.
The central bank's benchmark interest rates are also at historic lows -- 4.0 percent for the benchmark borrowing rate -- ensuring large piles of cheap cash for property development.
Aside from the macro economic picture, real estate analysts point to the outsourcing phenomenon as one of the key drivers of the property boom.
From virtually nothing a decade ago, outsourcing now employs more than 600,000 people and is worth US$11 billion annually, according to the main industry association which is forecasting 15 percent growth in the years ahead.
Many of the skyscrapers are being built to cater for the outsourcing workforce, which performs a myriad of tasks from call centre duties to designing architectural plans for foreign firms.
Meanwhile, roughly nine million Filipinos who work overseas are sending large chunks of the US$22 billion they earn -- equal to 10 percent of the nation's gross domestic product -- back home, often investing in real estate.
The frenetic building pace has some quarters anxious over a potential property bubble, with the global economic woes adding to concerns.
But Rick Santos, CBRE Philippines chief executive, remains bullish, in large part because of the expected continued growth in the outsourcing sector.
"As economies in the West tighten, global companies will see it in their interest to outsource their non-core functions to save on costs, " Santos told an industry briefing recently.
Ayala Land's Aquino also said local market had not seen the price bubbles that preceded crashes in other countries, where property values suddenly doubled or tripled.
"The price increases have been very close to or a little more than the inflation rate," Aquino said.
Trump Tower developer Antonio added: "We are confident that there's still a demand that has to be met."
The good times are into their fourth year, fuelled by steady economic growth, Western firms offshoring jobs to the Philippines, the buying power of millions of Filipinos working abroad and low interest rates.
"It just so happens that today the stars are aligned... we have never seen the economy this bullish," said Antonino Aquino, president of Ayala Land, one of the country's biggest property developers.
Ayala Land is one of the main players in what industry figures describe as an unprecedented construction boom that is transforming the skyline of the nation's capital, as well as many provincial cities.
In Manila, formerly sleepy pockets such as the Fort army base and the rundown Eastwood industrial zone have become chic, new business districts, catering mainly for the fast-growing outsourcing sector.
At the Fort, Ayala Land this year broke ground on its US$714-million One Bonifacio High Street project, which when completed in 2017 will host the Philippine Stock Exchange, a Shangri-La hotel, and retail outlets.
The project also has a 63-storey residential tower, with 298 suites ranging from US$500,000 to US$1.9 million that sold out last month in 96 hours, according to the company.
Across the country, more than 850,000 square metres (9.1 million square feet) of office space and 14,000 residential units will enter the market this year, property consultants CBRE Philippines said in a report.
It said many of the residential units catered for a growing middle-class on the fringes of Manila and other urban centres.
The building boom has also spread to hotels, shopping malls and casinos, triggering hopes of a long-anticipated take-off of the underdeveloped tourism industry.
Three of the world's biggest gaming industry leaders are building a US$4-billion, 100-hectare (247-acre) Entertainment City complex of casinos on Manila Bay. The first of the casinos are set to open early next year.
Meanwhile, Trump, the New York mogul, has put his name to a US$150-million, 56-storey, curtain-glass-walled Trump Tower that broke ground in the financial district this year.
"High-end buyers look for key differentiated features," said Robbie Antonio, managing director of Century Properties that is behind the Trump Tower development.
He said 70 percent of the 220 residential units, which are worth up to US$1.86 million each, have been sold.
The firm is putting up a nearby tower designed by the Versace fashion house -- the first of its kind in Asia -- featuring individual wading pools as well as its iconic Medusa-head brand imprinted on lamp shades and cutlery.
Century also flew in socialite and hotel heiress Hilton to Manila last year to help design and promote a suburban Manila residential project that features a man-made beach.
Industry players say the property boom reflects the overall status of the nation's economy as it picks up steam after decades of underperforming compared with many of its Asian neighbours.
The economy grew 6.4 percent in the first quarter, the stock market has surged 20 percent this year to hit all-time highs, and the country's credit rating has been bumped up to just a step below investment grade.
The central bank's benchmark interest rates are also at historic lows -- 4.0 percent for the benchmark borrowing rate -- ensuring large piles of cheap cash for property development.
Aside from the macro economic picture, real estate analysts point to the outsourcing phenomenon as one of the key drivers of the property boom.
From virtually nothing a decade ago, outsourcing now employs more than 600,000 people and is worth US$11 billion annually, according to the main industry association which is forecasting 15 percent growth in the years ahead.
Many of the skyscrapers are being built to cater for the outsourcing workforce, which performs a myriad of tasks from call centre duties to designing architectural plans for foreign firms.
Meanwhile, roughly nine million Filipinos who work overseas are sending large chunks of the US$22 billion they earn -- equal to 10 percent of the nation's gross domestic product -- back home, often investing in real estate.
The frenetic building pace has some quarters anxious over a potential property bubble, with the global economic woes adding to concerns.
But Rick Santos, CBRE Philippines chief executive, remains bullish, in large part because of the expected continued growth in the outsourcing sector.
"As economies in the West tighten, global companies will see it in their interest to outsource their non-core functions to save on costs, " Santos told an industry briefing recently.
Ayala Land's Aquino also said local market had not seen the price bubbles that preceded crashes in other countries, where property values suddenly doubled or tripled.
"The price increases have been very close to or a little more than the inflation rate," Aquino said.
Trump Tower developer Antonio added: "We are confident that there's still a demand that has to be met."
For latest update on real estate
development and its RA 9646, the Real Estate Service Act of 2009, visit
www.ra9646.com.
Monday, July 9, 2012
Philippines' Ayala in $1.5 bln property project in QC
AFP - Philippine property giant Ayala Land Inc. said Thursday it will spend 64
billion pesos ($1.5 billion) over the next 15 years to develop a former
squatter colony in a suburb of the capital.
The 29-hectare (72-acre) lot in the largely-residential Quezon City area will be a joint venture with the government's National Housing Authority which owns the property, company spokesman Jorge Marco said.
Ayala, known for its upscale housing, office and shopping mall projects, will develop the area while the housing authority will retain the real estate, he added.
"It will house both residential, office, retail and hotel units," he told AFP.
The first phase, spanning about four years, will involve setting up three buildings for business process outsourcing operations, along with a business hotel and a mall in a seven-hectare section, he said.
This first stage will cost about 12 billion pesos.
Much of the area was once a gigantic squatter area where some 6,000 families lived in squalor.
Hundreds of these squatters rioted in 2010 to oppose their relocation, forcing President Benigno Aquino to postpone the demolition of their shanties.
The area covered by the first phase of the project has already been cleared of squatters who have been relocated by the government, Marco said.
Ayala Land, the flagship of the diversified Ayala Corp. conglomerate, posted a 31 percent growth in its net profit last year, hitting 7.14 billion pesos.
For latest update on real estate development and its RA 9646, the Real Estate Service Act of 2009, visit www.ra9646.com.
The 29-hectare (72-acre) lot in the largely-residential Quezon City area will be a joint venture with the government's National Housing Authority which owns the property, company spokesman Jorge Marco said.
Ayala, known for its upscale housing, office and shopping mall projects, will develop the area while the housing authority will retain the real estate, he added.
"It will house both residential, office, retail and hotel units," he told AFP.
The first phase, spanning about four years, will involve setting up three buildings for business process outsourcing operations, along with a business hotel and a mall in a seven-hectare section, he said.
This first stage will cost about 12 billion pesos.
Much of the area was once a gigantic squatter area where some 6,000 families lived in squalor.
Hundreds of these squatters rioted in 2010 to oppose their relocation, forcing President Benigno Aquino to postpone the demolition of their shanties.
The area covered by the first phase of the project has already been cleared of squatters who have been relocated by the government, Marco said.
Ayala Land, the flagship of the diversified Ayala Corp. conglomerate, posted a 31 percent growth in its net profit last year, hitting 7.14 billion pesos.
For latest update on real estate development and its RA 9646, the Real Estate Service Act of 2009, visit www.ra9646.com.
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