Ayala Land strategy: Follow the infrastructure

Aya Lowe
Ayala Land is looking to where the new road, rail and airport projects will be for future developments

Ayala Land executives Fernando Zobel de Ayala (L), Antonino Aquino (C), Jaime Augusto Zobel de Ayala during a stockholders' meeting. Photo by Rappler.com/Aya Lowe

MANILA, Philippines – The company’s biggest developer, Ayala Land Inc., is looking in the direction of where new roads, rail, airport projects will be to set up its new residential developments, shared its CEO, Antonino Aquino.

Speaking at a press briefing on Wednesday, April 17, Aquino said they’re new development will target areas where infrastructure is going up.

“They have to have the major land infrastructure. Those are places that are interesting to us,” said Aquino.

According to Aquino, they are looking towards areas such as Bulacan, Rizal, Pampanga, Cavite and Batangas.

“So you might say the initial direction was pointing south, but now we will be pointing in all directions of the compass. In the north, east, west,” said Aquino.

This strategy was also brought up by Jones Lang Lasalle’s COO, Lindsay Orr in an interview with Rappler on November 29, 2012. When asked where the best place to invest is he said, “It’s easier to invest in residential units. As for upcoming areas the capital region is expensive, but you have to look at where the infrastructure is going. The sensible thing to do is to look at the areas that will emerge in the next 3 to 5 years. Look at where the LRT (Light Rail Transit) lines will expand.”

PPP projects

The Ayala group successfully made a bid for the 2-km Daang Hari-SLEx road project, the first of the public-private partnership flagship infrastructure scheme of the Aquino government. 

Ayala Land chair Fernando Zobel de Ayala had explained that the road project provides significant opportunities for synergies within the Ayala group, especially the real estate business, as it cuts travel time to their residential and commercial projects in the south, a rapidly growing part of the metropolis.

Ayala Land, one of the country’s biggest real estate firms, is behind Alabang Town Center and Ayala Alabang Village, two posh properties located near the Daang Hari road.

The Ayala group is also pursuing rail projects the government is bidding out in Metro Manila through a partnership with conglomerate Metro Pacific Investments Corp (MPIC).

The two are among the final bidders for the LRT-1 Cavite Extension rail project, which connects Metro Manila to the bustling areas in Cavite. 

Their joint venture was among the 9 pre-qualified for the P1.72 billion automated ticketing system for the Metro Rail Transit (MRT) and Light Rail Transit (LRT)

The conglomerate is also among the bidders for the P17-billion Mactan-Cebu International Expansion project, which involves the country’s second busiest gateway. They are in partnership with the Aboitiz group for this venture.  

Ayala Land Inc recorded high earnings in 2012 on the back of strong residential sales and controlled expenses.

The company recorded P9 billion in net income in 2012, a 27% increase from a year ago. In 2012, the company also launched 23,487 residential units.

The developers’ residential arm makes up 43% of the company. There are currently 140 ongoing projects all over the country worth P240 billion in sales value. This is split across their 5 brands: Ayala Land Premier, Alveo, Avida, Amaia and Bella Vita. – Rappler.com

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