Developer launches biggest project in Cebu

CEBU, Philippines - Aboitiz Land Inc. is developing a multi-billion housing project in Balamban town, a testament of the developer’s optimism on the Cebu market.

President and CEO Andoni Aboitiz said Cebu remains a key home market for the property firm.

"Cebu will always take up a lot of our projects... so much land here," he said in an interview at the sidelines of the launch of firm's new project Foressa Mountain Town, a 300-hectare mountain housing community in Cansomoroy, Balamban, Cebu.

Aboitiz said this is so far the company's biggest project in Cebu — in terms of land area — which will also have commercial components.

The mountain project is 7 kilometers away from Balamban proper and 45 kilometers from Cebu City and is accessible along the Transcentral Highway for a 90-minute ride from the city.

"This is slated to be a multi-year project," he said.

The development will come in four phases, with the first phase composed of 51.5 hectares schedule to start in the fourth quarter this year.

The CEO said the first phase would probably cost the company some P300-P400 million to develop.

The first phase will have 114 lots ranging from minimum of 300 square meters to a maximum of 690 square meters and its turnover is set fourth quarter of 2020.

To date, Aboitiz said the firm has already developed 10-12 projects in Cebu.

It is also developing a 17.5-hectare mixed-use project in Mandaue City the Gatewalk Central with Ayala Land.

He added the property firm also has a 400-hectare landbank in Liloan town, Cebu.

Since then, Aboitiz Land has developed more than 612 hectares of land in Cebu into residential, commercial and industrial sites.

Last year, it announced its expansion in Luzon with plans to develop a total of 83.2 hectares of land in various areas particularly in San Juan and Lipa, Batangas South Luzon, and Nueva Ecija and Tarlac in North Luzon.

The company official said in the Visayas, Cebu remains a priority in terms of expansion prospect and that there are no solid plans yet on expanding in other key cities in the region.

In 2016, the property firm’s revenues dropped by 7 percent to P2.4 billion, contributing only P188 million to its listed parent Aboitiz Equity Ventures from the P536 million in 2015.

The 65 percent drop in income contribution to AEV was attributed to “deferred industrial business unit revenue recognition, planned increases in operating expenses intended for the organization’s future growth.”

In its recent market study, property consultant Pinnacle said new township developments may spread out the centralized development in Cebu City as it considers the Cebu real estate market reaching its maturity.

Pinnacle said although the Cebu property market is very developed, "there are still gaps in the market and some market inefficiencies that shrewd players may take advantage."

"The recently approved vertical socialized housing, and the increase in the price and loan ceiling of economic housing may extend the boom in the residential sector," the property consultant said.

It told developers to have proper due diligence and detailed market study due to competition.

Pinnacle noted that Cebu's residential market shows a phenomenal growth in the past four years. (FREEMAN)