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AYALA
Land Inc. (ALI), the largest property developer in the
country, is allotting P24 billion for capital
expenditure this year, a sum 60-percent higher than the
P15-billion capex it set in 2007.
At the
sidelines of the company’s annual stockholders meeting
Wednesday, president Jaime Ayala said the capex would
support the company’s aggressive expansion in the
residential and office development segments and support
priming activities in strategic landbanks in the Makati
Central Business District, Bonifacio Global City and
Canlubang, Laguna.
“It’s
the biggest capex so far in the history of the company.
This is a clear indication of how upbeat we are in the
real estate sector even with the global developments in
the financial market,” he said.
The
capex will be funded through a combination of internally
generated cash and borrowings. ALI senior vice president
and chief financial officer Jaime Ysmael said they plan
to raise P10 billion through loans and sale of bonds in
the second half to support the capex program.
Meanwhile, despite the subprime crisis that is affecting
the US economy, Ayala said the company continues to
perform well on the back of the strong domestic market.
“In fact
in the residential segment, we’ve recorded 39 percent
rise in booking sales for the first two months of the
year. Although the sales from the US market have
flattened, its impact was not reflected across all our
residential projects,” he said.
He said
ALI’s strategy is to push for lower-priced products and
open up more distribution channels in the
Middle East and
Europe or in areas which are less affected by the subprime.
On the
BPO space segment, Ayala said indications are still
positive as demand continues to be very strong.
In a
related development, the stockholders of the company
approved the plan to issue up to 1 billion common shares
to generate funds for expansion.
The
shares have an aggregate par value of P1 billion.
ALI can
exchange such shares for properties or assets and/or to
raise funds to acquire properties or assets needed for
the business of the corporation via issuance of equity
or equity-linked instruments.
The
price and the terms and conditions will be determined by
the board based on prevailing market conditions or on
agreements negotiated.
“The
timing [for the issuance] depends on a lot of factors
like how immediate is the need for it. We will do it
responsibly at the right price,” said Ysmael.
ALI,
whose shares are traded on the Philippine Stock
Exchange, is a subsidiary of Ayala Corp. |
