RLC sets P15-B capex over next 2 years

Awash with cash from a recent stock offering, Robinsons Land Corp. (RLC), the property concern of tycoon John Gokongwei, is spending about P15 billion in the next two years for the construction of new malls, office buildings and housing projects, as well as the acquisition of new properties.

In a financial report filed with the Securities and Exchange Commission, RLC said 40 percent of the programmed capital budget will be used to build new malls in Dumaguete, Bulacan, Paco in Manila, Tagaytay and Davao, as well as refurbish existing shopping centers in Ermita, Manila and Bacolod.

About 30 percent of the budget will go to the establishment of new office buildings catering to business process outsourcing (BPO) firms.

RLC is currently constructing seven residential condominium buildings: Fifth Avenue Place and McKinley Park Residences in Fort Bonifacio Global City, Gateway Garden Ridge and One Gateway Place in Robinsons Pioneer Complex, One Adriatico Place, Two Adriatico Place, and Otis 888 Residences in Manila; and two office buildings Robinsons Cybergates 2 and 3.

For its mall expansion, RLC is redeveloping a portion of Robinsons Galleria, called the West Wing, which is expected to be completed before the end of the year. It is also expanding Robinsons Place Manila by constructing the Midtown Wing and Robinsons Place Otis 888, a strip mall fronting its residential development project in Paco, Manila.

RLC currently operates 18 malls in selected locations across the country with total gross floor area of 1.1 million square meters. Of these malls, six are in Metro Manila and 12 are in other urban areas throughout the Philippines.

The company reported a 40 percent jump in its net profit for its fiscal year ending September 2006 to P1.725 billion from P1.23 billion a year earlier. Revenues grew 29.8 percent to P6.64 billion from P5.12 billion, 48.5 percent or P3.22 billion of which came from the commercial centers division.

"All our business units performed very well as a result of the strategic initiatives we have pursued in recent years. Each business unit has expansion programs that will grow our investment property portfolio in malls, offices, and hotels as well as increase our real estate sales of condominiums, subdivision land and houses," RLC president and chief operating officer Frederick D. Go said.

RLC’s office and residential buildings division likewise performed well, posting a 90 percent growth in revenues at P2.03 billion compared with P1.07 billion a year earlier.

The housing and land development division, on the other hand, chipped in revenues of P488 million, up nine percent from a year earlier. Strong domestic sales and the rapid expansion of its international marketing operations, now in North America, Europe and the Middle East, have boosted pre-selling efforts.

Among the ongoing projects of Robinsons Homes are Bloomfields Tagaytay, Bloomfields Davao, Richmond Hills and Monte Del Sol both in Cagayan De Oro, Mirado Dos in San Fernando and Costa Verde in Davao City.

Meanwhile, the hotels division contributed P903.5 million in revenues as against the previous year’s P499.8 million, largely due to the full operation of the deluxe 260-room Crowne Plaza Hotel within the Galleria Complex in July 2005.

In October, RLC raised $223 million from the sale of 932.8 million shares in both local and international markets.

As of end-September last year, RLC’s total assets stood at P32.76 billion, 27 percent higher than the year ago’s P25.7 billion.

RLC is the real-estate arm of JG Summit Holdings Inc, one of the country’s largest conglomerates with diverse interests in branded consumer food products, agro-industrial and commodity food products, textile, telecommunications, petrochemicals, air transportation and financial services.