In search of a wider market

In the last few years, Ayala Land, Inc. under chairman Fernando Zobel de Ayala has been quietly widening its consumer base. Long identified with the upscale market, ALI has come up with products for the low-to-middle market segments.

ALI started with pre-fabricated homes that brought down the cost of purchase in middle-income subdivisions. Then, it developed shopping malls like the Pavilion, which caters to the residents of Binan, Laguna, and the Metro Point, which caters to the MRT commuters in Metro Manila.

Both malls are joint ventures, with ALI providing the construction and management. In the case of the Pavilion, which has been around for the last three years, ALI has a 30% stake while real estate firm, Extraordinary Corp., holds a 70% stake. In the case of Metro Point, ALI and Concepcion Industries Inc. each hold a 50% share.

"These mid-market malls complement our existing upscale commercial centers in Makati, Alabang, and Cebu," said ALI vice-president of the commercial centers group, Miriam Katigbak.

Metro Point is a five-level 8,000 square meters commercial center at the junction of EDSA and Taft Ave. in Pasay City. Opened last December, the mall’s second level is linked to the MRT line. By June, the mall’s third level will be connected with the LRT that runs along Taft. Ave.

"It’s a good location to put up a mall because it’s the only area right now where the MRT and LRT lines meet," said ALI assistant vice-president Rowena Tomeldan. The mall is projected to have a daily customer base of 30,000 to 40,000 by the third quarter of this year.

The first two floors of the mall are now fully occupied by retail stores and stalls while the upper floors are mostly occupied by offices. "We’re not bringing high-market brands intro Metro Point," said Tomeldan. "Instead, we have fast food chains and other affordable retail outlets. We adjust to the needs and wants of the market, which is the ordinary commuter."

Although it holds a 15.8% in Metro Railway Transit Corp., ALI does not have the exclusive right to develop retail outlets at the MRT. "We had to submit our proposal just like anybody else," said Tomeldan.

By June this year, ALI will start work on a transportation and terminal complex called Market!Market! on a 9.7-hectare property along C-5, just outside the Fort Bonifacio complex in Taguig.

To be completed in three years, the project will be anchored by a 150,000 sqm. five-level mall catering to budget-conscious shoppers. "It’s like putting a roof over Tutuban, Greenhills and Dangwa, where one can bargain in air-conditioned comfort," Tomeldan said.

Aside from the usual retail stores and fast food outlets, Market! Market! will have themed bazaars, car accessories and repair stores and stalls selling fresh flowers, fruits and vegetables.

To bring in goods and people, Market!Market! will have an access road to C-5, which ALI will build with the help of the Bases Conversion Development Authority, as well as terminal areas for buses and jeepneys.

"They could be regional buses or short-distanced buses. We’ve already begun talks with some bus lines but we can’t name them yet," said ALI senior division manager of the commercial centers group Francis Roxas.

In line with a long-standing government plan, ALI also intends to link Market! Market! by rail to other parts of Luzon. "We see the opportunity in this government plan, which will mean a huge volume of consumer traffic to Market!Market! but a railway station is still tentative," said Roxas.

Market! Market! will eat up a sizeable share of ALI’s capital expenditure budget this year. A third of ALI’s projected P4.2-billion capex has been earmarked mainly for the construction of Market! Market! and the redevelopment of Greenbelt. Last year, 45% of the company’s capex of P2.5 billion went to Metro Point and the refurbishing of the Greenbelt commercial complex in Makati and the retail stalls at the MRT Ayala station.

Clearly, ALI is putting a huge portion of its money in developing the downmarket.