Eton to convert Quezon City lot into mixed-use township

MANILA, Philippines - Eton Properties Philippines Inc., the real estate arm of the Lucio Tan Group of Companies, is acquiring a 12-hectare property in Quezon City where it is currently developing a fully-integrated mixed-use township, through a P4-billion share swap deal with another Tan-controlled company.

In a press briefing yesterday, Eton president Danilo Ignacio said the acquisition of the property from Paramount hand equities Inc. will boost the company’s assets to around P7 billion, strengthen its balance sheet, and give it more elbow room to borrow.

“This would be the first asset that we would own because most of our projects are in joint venture with the Tan-owned banks and/or corporations. With this acquisition, we will be able to borrow and become more aggressive with respect to the launch of more projects,” Ignacio said.

In exchange for the property, located at the corner of EDSA and Quezon Ave., Eton will issue 1.6 billion shares from its authorized but unissued stock in favor of Paramount at P2.50 each share or at 17-centavo premium over the three-month weighted average of the trading price of Eton’s shares of P2.33 per share.

Upon completion of the transaction, Paramount will own a controlling 55 percent of Eton.

The township project, to be called Eton Centris, will be a masterplanned community featuring middle to high-end residential condominium buildings, office buildings catering to the business process outsourcing sector, a commercial and retail strip.

Under construction is Eton Cyberpod Centris, a 12-storey BPO office building which will have Wipro (one of India’s biggest BPO companies), Unisy, and Bluestream as among the early tenants. 

Ignacio said Centris Station, a two-level commercial center anchored by SM Hypermarket and a mix of restaurants, specialty and service-oriented shops, is slated to open next month. SM Hypermart is expected to be operational on Nov. 15.

On the other hand, the retail component, Centris Walk, is slated to open in the first quarter next year and is envisioned to become the new dining, lifestyle and entertainment capital of the metropolis.

Ignacio said plans are also underway to put up an events venue within Centris.

Negotiations are also ongoing for a University of the East Graduate School that will offer masters’ courses in public and business administration.

For the residential component of Centris, Eton is planning to put up 12 middle to high-rise condominium buildings which will offer studio and one-bedroom units.

Ignacio said Eton is gearing up for the development of two more high-rise residential buildings to take advantage of the anticipated market shift towards high-rise, high-density dwellings as a result of the massive damage caused by tropical storm Ondoy which triggered the worst flooding in Metro Manila in more than four decades.

These high-rise residential projects are expected to rise on a 3,100-square meter lot in Herrera and Dela Rosa streets in Makati alongside an existing 40-storey building and an 8,000-square meter property in Adriatico, Manila beside Robinsons Place. 

Ignacio said the company is also studying the feasibility of building a mid-rise condominium project in a four-hectare lot within the Sta. Ana racetrack.

He said the months of August and September have been the best months for the company, reflecting a significant jump in Eton’s reservation sales during the third quarter of the year.

Eton is expected to post positive results this year as it starts to book revenues from residential projects under construction.

Under accounting rules, revenues will only be realized based on percentage completion of residential project construction.

Last year, the company incurred a net loss of P125.76 million, down 14 percent from 2007 level. 

In the first six months of the year, Eton reported a net income of P40.6 million, a reversal of the P140.2-million loss incurred the previous year. Revenues reached P503.8 million, mainly coming from One Archers Place, South Lake Village at Eton City and the first clusters at The Manors at North Belton Communities. 

The company is expected to register more revenues by the end of the year with the substantial construction of additional residential projects: The Eton Residences Greenbelt and Eton Baypark Manila. Likewise, Eton will begin earning leasing income from its office projects Eton Cyberpod Centris and Eton Cyberpod Corinthian, both to be operational on the third quarter, and from its commercial projects Centris Station and Centris Walk, which will start operations in the fourth quarter.