PHILIPPINE Realty and Holdings Corp. (PhilRealty) on Tuesday said it will diversify its business to include power, health care and education, in a move to weather the cyclicality of the real-estate business.
The company, which has just went out of corporate rehabilitation, said its diversification strategy was started by forming a power unit called Sultan’s Power Inc. It said it is in current talks to buy a company that turns garbage plastics into petroleum that will be then sold to power plants.
Andrew Alcid, PhilRealty president, said the company is based in San Mateo, Rizal, where most of Metro Manila’s garbage are dumped. Alcid said it will start with a 5-ton capacity a day, which will turn in an annual output of 819,000 liters of diesel, 82,000 liters of kerosene and 129,000 liters of gasoline.
“We are still talking, but we may have a launch before the end of the year,” Alcid said in a briefing. He did not disclose the investment figures, as talks are still ongoing between the two parties.
The company said it is also diversifying to other businesses such as health care, education and financial services, but most of these are still on the drawing board.
Among the other businesses, only the health-care business are allied with real-estate development, as the company is fitting its development for the elderlies.
The said expansion is part of the company’s effort to move to other businesses, so it will have a stable income when income from real-estate development is down.
“PhilRealty is expanding its portfolio to industries that carry our core philosophy of creating better communities for Filipinos. We have identified the five corporate pillars that complete our company’s blueprint for the future,” PhilRealty Chairman Gerardo Lanuza Jr. said.
“The positive economic outlook has created opportunities to look into industries outside real estate that can provide additional revenue stream for the company and expand its business portfolio,” Lanuza added.
PhilRealty exited a court-assisted corporate rehabilitation in March 2014, and resumed normal business operations to post a strong profit growth last year.
It saw its net income climb 178 percent in 2014 to P109.21 million from P39.347 million in 2013, on the back of a 41.9-percent gain in revenues. In 2014 PhilRealty topped off SkyVillas, launched Skyline Premiere and completed the master plan for One Balete in Quezon City. On the drawing board is a new residential project in Old San Juan and an office project in Bonifacio Global City, Taguig.
The company said it is on track to complete SkyVillas at One Balete and deliver the units to homeowners by mid-2016. The two developments in New Manila saw the company’s return to the niche high-end family market. PhilRealty is also set to develop the last prime property at Bonifacio Global City.
To increase the company’s liquidity, PhilRealty sold four parcels of land in La Union to Humboltbay Holdings Inc., for P202.12 million. It tapped CPG Corp. of Singapore, which designed Changi Airport Terminals and Sands by the Bay, to craft the master plan for One Balete, formerly known as Andrea North Condominium Project in Quezon City. The SkyVillas in Quezon City and Project Cube 5th Avenue in Fort Bonifacio are the company’s two major real-estate projects.