Megaworld: Transitioning from developer to landlord
Property developer Megaworld Corp.?s strategy of making money by developing and keeping its land has paid off tremendously for Bilyonaryo Andrew Tan.
Megaworld has seen steady growth in its bottomline through the years, driven by higher rental income, which comes from its expanded office and commercial retail portfolio.
In the nine months to September, lease income grew 15 percent to P7.41 billion, mainly due to the opening of new malls and commercial centers in its various integrated urban townships, particularly Uptown Bonifacio, McKinley Hill, Forbes Town Center, Iloilo Business Park, The Mactan Newtown, and Twin Lakes; and new office towers in McKinley West, Uptown Bonifacio, The Mactan Newtown, and Iloilo Business Park.
It also expanded its hotel portfolio with the introduction of another local hotel brand, Belmont Hotel, which launched its first hotel in Newport City late last year. This is in addition to the group?s Richmonde Hotels in Eastwood City, Ortigas, and Iloilo.
Megaworld, the country?s biggest developer of integrated urban townships and the largest lessor of office spaces, grew its nine month net income by 11 percent to P9.27 billion. Revenues went up five percent to P35.26 billion.
?Our fundamentals remain strong and we are happy to see that our anticipated aggressive growth in our rental businesses continues. What we are now witnessing is the transition of Megaworld from being just a builder into becoming a landlord. This means that the company will be insulated from any cyclicality from the residential business while having steady or even higher growth moving forward,? said Megaworld treasurer Francis Canuto.