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Integrated townships

By Mary Ann Ll. Reyes (The Philippine Star) | Updated April 1, 2015 - 12:00am

Just recently, Megaworld Corp. announced a 139 percent growth in its net income for 2014.

Said to be the country’s leading integrated urban township developer and biggest office developer and landlord, Megaworld posted a net income of P21.6 billion. Without non-recurring gain, net income still went up 14 percent to P9.4 billion last year.

This actually reflects an 18 percent annual growth since 2009 when net income was only P4 billion.

Consolidated revenues, excluding non-recurring gain, increased 15 percent to P41 billion. Real estate sales grew 16 percent year-on-year to P24.6 billion, while rental income rose 17 percent to P7 billion.

According to Megaworld chairman and CEO Dr. Andrew Tan, last year, which happened to be the company’s 25th year, was a milestone, with the property firm raking in record earnings and managing to grow its landbank to over 4,000 hectares.

Part of the growth comes from Megaworld’s integrated urban township developments in Metro Manila, Cebu and Iloilo as well as tourism-related projects in Tagaytay and Boracay.

Dr. Tan noted that, in the meantime, rental income is growing in line with their expectations, while continued growth in office and mall leasable space would provide the catalyst for exceeding P10-billion in rental income in 2016.

He expects to maintain similar growth momentum generated in the past, achieving a double-digit net income growth every year on the back of a stronger and bigger township portfolio.

Five townships that were launched last year and another five townships to be launched this year would increase the company’s township developments to 20 by the end of 2015.

Last year, the company launched the following townships: Woodside City in Pasig City (12.3 hectares); Southwoods City in the boundaries of Cavite and Laguna (561 hectares); Davao Park District in Lanang, Davao City (11 hectares); Alabang West in Las Pinas City (62 hectares) and Suntrust Ecotown in Tanza, Cavite (350 hectares).

Just last week, the company announced two of the five township developments lined up for this year: The Upper East (34 hectares) and Northill Gateway (50 hectares), both in Negros Occidental.

Megaworld’s pioneering “live-work-play-learn“ concept for integrated mixed-use communities, or commonly known as townships in the Philippines, has enabled the company to complete 342 buildings with a total area of 6.4 million square meters over the past 25 years.

As it aggressively expands its township developments across the country, Megaworld expects that the population in its various urban townships would reach at least one million by 2020.

Dr. Tan earlier revealed that its 20 townships across the country would be home to around 600,000 condominium and village residents and 400,000 business process outsourcing (BPO) and office workers.

At present, Megaworld has around 250,000 residents and 150,000 BPO and office workers in all of its existing townships. The number of BPO workers comprises around 15 percent of the total BPO population in the country, which now stands at around 1.04 million.

Dr. Tan has explained that the increase in population in its mixed-use communities “indicates the opportunities that await the company’s commercial and retail partners.”

Through the years, Megaworld has successfully built malls and commercial centers in each of its townships to primarily cater to the growing communities within its developments. Among its malls and commercial centers include Eastwood Mall, Citywalk 1 & 2 and Cyber & Fashion Mall in Eastwood City; Newport Mall in Newport City; Venice Piazza and Tuscany in McKinley Hill and Lucky Chinatown in Binondo, Manila, among others. New malls in Uptown Bonifacio and McKinley Hill, both in Fort Bonifacio, are expected to open within the year.

Megaworld started its commercial and retail business when Eastwood City was established in 1999. Recognized as the Philippines’ first urban township and cyberpark, Eastwood City in Bagumbayan, Quezon City is now home to almost 25,000 condominium residents and around 70,000 BPO and office workers. It used to be a 16-hectare township, but it expanded its land area last year to meet the growing demand for residential, office and commercial spaces. Today, the township houses more than 500 commercial and retail partners.

The company is replicating the live-work-play-learn model that it pioneered in Eastwood City to other areas around the country.

Dr. Tan pointed out that more townships mean more jobs and opportunities and that from construction to BPOs, from retail and food to small-and-medium enterprises and transportation, these townships help create economic clusters, which in turn, help boost purchasing power and consumerism among Filipinos.

The company is launching at least 20 new malls and commercial centers in its existing and new townships in the next five to eight years, primarily catering to the residential and BPO communities inside these townships.

Last year, Megaworld announced that it is spending P230 billion to develop its various existing townships until 2019.

This figure is exclusive of the development costs for the new five townships that the company is launching this year.

The innovations of Megaworld also paid off by positioning itself as the country’s biggest office developer and landlord with 712,000 square meters of leasable office spaces by the end of 2014, tapping the demand for information technology-business process outsourcing (IT-BPO) setting up offices in the Philippines.

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