ALI to issue P2-B fixed rate notes

Property giant Ayala Land Inc. (ALI) has approved the issuance of up to P2-billion worth of fixed-rate corporate notes within the year.

In a disclosure to the Philippine Stock Exchange, ALI said it may still increase the final issue size as the need arises.

ALI said the notes will be issued in up to three tranches having maturities of five years, seven years and/or 10 years from issue date. Issue amount and interest rate with respect to each tranche of the notes will be determined pursuant to a "Dutch auction" to be conducted on the pricing date among primary institutional lenders.

ALI earlier said it was considering borrowing P3 billion to P4 billion in long-term loan to finance capital expenditures and prefund maturing obligations.

The company has loans maturing early next year amounting to P3 billion.

For this year, the company has set aside P4 billion for the construction of new malls in line with efforts to increase its gross leasable area by 400,000 square meters in the next five years,

Among these new malls are Tri Noma, a project of the North Triangle Depot Commercial Corp. which will rise on a 200,000 square meter property; Greenbelt 5 which will have 30,000 square meters of gross leasable area; Ayala Center Cebu and the retail portion at Serendra at the Fort.

The Tri Noma, positioned as the entertainment and dining nucleus of Quezon City, is targeted to be completed in 2007. Landmark Department Store has agreed to be the anchor tenant.

Tri Noma will also have a new public transport terminal to be developed in the depot site, which will make the commercial center a major inter-modal transport hub and public convergence point in Quezon City.

Positioned as a fashion lifestyle center, Greenbelt 5 will be opening its doors to the public in 2008 with 31,250 square meters of leasable space. The retail portion at Serendra, on the other hand, comprises 6,400 square meters and is being patterned after the Soho-Greenwich area of Manhattan.

The expansion of Ayala Center Cebu, on the other hand, will add about 13,500 square meters to the mall.

ALI is also planning to divest some of its real estate properties that are no longer considered strategic for the group. It has a total landbank of 4,159 hectares, consisting of four components: Makati (54 hectares), Bonifacio Global City (44 hectares), Canlubang (1,696 hectares and 2,365 hectares in other parts of the country.

The company is considering selling 400 hectares of its existing landbank.