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MANILA, Philippines (UPDATED) – Strong demand for residential units and expansion hiked the net income of Villar-led property development firm Vista Land & Landscapes to P2.19 billion in the first 6 months of the year.
This 25% jump from year-ago’s P1.74 billion from a year ago was largely due to the Philippines’ bright economic climate and low financing cost, explained company president and CEO Manuel Paolo A. Villar at a press briefing on Wednesday, August 15.
“The macroeconomic situation of the Philippines has been good for real estate. There’s a lot of confidence,” Villar said, highlighting that long-term investments, like real estate assets, take a cue from the overall economic health of the country. .
“We’re helped by low interest rates. There’s a lot of liquidity in the market, mortgage financing is good. There has been economic growth and remittances have remained [solid],” he added.
Amid the positive business climate, revenues rose 22% to P8.1 billion in the first half of 2012 from P6.6 billion in the first half of 2011.
Correspondingly, sales were robust, registering 47% growth to P20.0 billion.
On top of the positive buying sentiment, the company bolstered income through expansion, largely outside of Metro Manila.
The company is sticking to its past strategy of catering to the affordable market and capturing more growth in the provinces, according to Vista Land chief financial officer Ricardo B. Tan, Jr.
Vista Land is the holding company of the real estate units – Brittany, Crown Asia, Camella Homes, Communitities Philippines and a condominium development subsidiary, Vista Residences.
Expansion
Vista Land launched 15 subdivision projects worth about P12 billion during the first half. This involves
- 12 projects launched in the low and affordable segment
- 3 mid-rise projects
- 8 launched outside Mega Manila
Projects in new areas:
Palawan
- Launched in March; over 10 hectares; over 700 units
- Project value: P1.6 billion
- About 30% sold
Vigan
- Launched in June; approximately 15 hectares; over 1,000 units
- Project value: P2.2 billion
- Over 10% sold
Bohol
- Launched in June; approximately 10 hectares; 650 units
- Project value: P1.4 billion
- About 30% sold
“This brings our presence to 28 provinces nation wide… We’re really dotting the whole philippines. I don’t think any other developer has this kind of geographic presence,” said Tan.
Market segment
Other developers like Ayala Land are swooping in on the affordable market but Vista Land, founded by businessman-turned-politician Sen. Manuel B. Villar, has been focused on this segment nearly since its inception.
When other developers were ignoring the low-end housing market in the ’80s and ’90s, Camella Homes became a pioneer in the affordable segment.
Camella encountered financial problems and was sent to the brink of bankruptcy after the 1997 Asian Financial Crisis.
Sen. Villar snapped up several joint ventures and reorganized his real estate empire under Vista Land in 2007 but he kept Camella as one of its brands.
Villar’s company is staying true to the bread and butter of its business: low-end customers.
“Our revenue distribution is consistent with what it’s been for the last couple of years, growth is being led by the Camella brand, which has been around since 1977,” said Tan.
The company doesn’t think demand in the large low-income bracket is going away any time soon. In fact, with rising incomes and a swelling young population, Vista Land expects demand to increase.
“We have almost 100 million people… so the demand for housing will probably be very strong in the coming years and Vista Land will be there to meet that demand,” said the company chief. – Rappler.com
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