At the sidelines of Philrealty’s annual stockholders’ meeting yesterday, company president Amador Bacani said management hopes to further reduce its debt level by P600 million by the end of the year.
Bacani said the company will continue to undertake measures aimed at reducing debts to a more manageable level.
He said net proceeds from the sale of its shares in International Exchange Bank, amounting to P1.1 billion, were used to settle debt with its largest creditor-bank.
Bacani said the company expects to generate P1.1 billion in sales from its residential condominium project in Fort Bonifacio, Taguig. The project is in joint venture with Xcell Property Ventures Inc.
"Our joint venture with Xcell Property for the development of the twin towers Icon Residences on our two Bonifacio Global City lots fronting the Manila Golf Club benefited from the robust real estate sector," Bacani said.
Bacani said Tower 1, which was launched in mid-March last year, is now 78 percent sold, leading to the decision to launch Tower 2 in February this year.
Excavation work for Tower 1 is ongoing with the tower projected to be completed by the first quarter of 2009.
Bacani said the company also intends to resume work at the Andrea North Skyline Tower after it receives payments for the land of Tower 2, which is expected to happen before the end of the year.
Starting in 1998, Philrealty has offered land properties to banks as payment for its obligations through dacion en pago to substantially reduce its obligations.
The company’s strategy is to enter into joint ventures whereby Philrealty will merely contribute the land and other pre-development expenditures while the partner will shoulder the cost of construction of the building.
Philrealty reported a significant turnaround in its financial performance last year as it posted a net income of P323.52 million as against a net loss of P94.4 million in 2004.
The turnaround was due to the gain earned from the reversal of excess accrued interest in accordance with the court-approved rehabilitation program and by a jump in equity earnings.
In December 2005, Philrealty started payment of interest on its restructured loan.
Consolidated gross revenues reached P507 million, up 223 percent from P157 million in 2004. Rental income likewise went up 22.1 percent as major areas were leased out.