DoubleDragon acquires low-cost housing developer

MANILA, Philippines - DoubleDragon Properties Corp., the joint venture between Mang Inasal founder Edgar “Injap” Sia II and Jollibee Foods owner Tony Tan Caktiong, is continuing its acquisition binge, this time securing a majority stake in a low-cost housing developer.

The acquisition of a Western Visayas-based real estate firm gives DoubleDragon a vehicle for horizontal developments in the Visayas area, the company said in a disclosure to the stock exchange.

“In line with the company’s plan to continuously expand its portfolio of development projects around the counter, DoubleDragon signed on May 23 an investment and shareholders agreement with Zion Land Development Ph Inc.,” it said.

DoubleDragon acquired a 70 percent stake in Zion Land for P140 million, giving the affordable housing firm P200 million in equity.

Zion Land, which has no landbank so far, is a Western Visayas-based housing company set up in 2011. Its first operating year was in 2013, with bulk of sales due for recognition this year.

“Zion Land is planned to be DoubleDragon’s horizontal residential project arm in the Visayas area and will complement its project portfolio of providing affordable horizontal primary residential development in the provinces and is seen to address the country’s huge housing backlog,” DoubleDragon said.

DoubleDragon said the affordable housing developer is expected to generate P389 million in revenues this year and P85.6 million in net income. The listed property firm is expecting almost P350 million in earnings this year with the start of the operations of various commercial centers.

Zion Land of the Du family specializes in developing affordable homes in convenient locations, with end-users accounting for majority of the buyers.

The sales and marketing workforce of Zion Land will remain intact but DoubleDragon said it will bring more financial capacity for the expansion.

“DoubleDragon will continue to acquire interest in properties in prime and strategic locations and with strong growth and market potential,” DoubleDragon said.It also intends to “keep its eye on similar majority stake acquisition of existing mid-sized horizontal residential companies with existing strong management and sales force in Mindanao, North Luzon and South Luzon to complete the portfolio of DoubleDragon’s residential horizontal arm all over the country.”

Five years into operations, DoubleDragon already sold out and completed the People’s Condominium, the first condominium project in Iloilo, and the 111-unit First Homes Village, also in Iloilo.

Its first foray in Metro Manila is the 30-story W.H. Taft Residences just beside De La Salle University along Taft Ave.

DoubleDragon earlier acquired a commercial lot from Sta. Lucia Realty & Development Inc. in Cansaga, Consolacion, Cebu for its CityMall community mall. Early this month, DoubleDragon acquired the rights, title and interests of Equitable Development Corp. and Menlo Capital Group in a 5,972-square meter (sqm) lot in Divisoria, Manila.

DoubleDragon aims to reach P1 billion net income by 2016 and P4.8 billion by 2020. It also aims to reach one million sqm of total leasable space portfolio by 2020, of which 700,000 sqm is expected to come from the planned 100 CityMall community malls, mostly in the Visayas and Mindanao.

In the first quarter this year, DoubleDragon said its net income spiked 117 percent to P21.2 million from P9.8 million a year ago while consolidated revenues surged 142 percent to P172.5 million from P71.3 million.