Rockwell Land goes into hospitality sector

MANILA, Philippines - Rockwell Land Corp., the upscale property arm of the Lopez family, has substantially jacked up its capital spending to P10 billion this year to continue its project development amid the ongoing property boom.

The property firm expects another banner year given double-digit growth in earnings and its foray into the hospitality sector, company officials said yesterday.

“We are looking at a capital expenditure of, without new land acquisitions, about P10 billion. Last year was P7.5 billion,” Rockwell Land chief finance officer Ellen V. Almodiel said in a briefing after the company’s annual stockholders meeting.

Specifically, the firm will spend P500 million for the Aruga Serviced Apartments but bulk of the capital was allotted for the development of residential towers in Proscenium and the Grove.

The developer expects another banner year as it rides on the property boom.

“We would like to achieve a 20 percent growth in terms of bottom line. The range is 16-25 percent,” said Rockwell Land president and CEO Nestor J. Padilla, adding that sales from new projects like the Proscenium and Cebu will drive the earnings growth. The company’s profit rose 25 percent to a record P1.4 billion in 2013 from P1.1 billion in 2012.

Revenues would likely hit as much as 9.5 billion this year from P7.8 billion in 2013, Padilla said. Rockwell Land is set to introduce to the market the 335 units in the Proscenium’s Lorraine tower and 300 units from the Cebu project this year.

Rockwell Land currently has P15 billion in unrecognized revenues, most of which will be booked in 2015 and 2016 as the residential projects are completed.

To improve its recurring income portfolio, Rockwell Land announced the launch of its first venture into the hospitality sector through Rockwell Hotels and Leisure Management Corp.

The Aruga Serviced Apartments at Edades Tower and Garden Villas will offer 114 studio, one-bedroom and two-bedroom units catering to the growing market of mobile businessmen and professionals, Rockwell Land said.

“The Aruga Serviced Apartments at Edades will be the first of Rockwell Land’s several ventures into hotel and leisure, which we plan to expand to different locations in the country,” Padilla said.

Rockwell Hotels will also put up a serviced apartment in The Grove in Ortigas and another in Cebu, allowing the company with 300 serviced apartment rooms by 2016.

Higher interest income allowed Rockwell Land to post a double-digit profit growth in the first quarter. Its earnings jumped more than 17 percent to P254.2 million from P216 million in the same period last year while consolidated revenues inched up four percent to P1.42 billion from P1.36 billion.