Bullish on PHL, Villar sets aggressive expansion
TYCOON Manuel B. Villar, Jr. is looking at aggressively expanding his property and retail businesses in the next few years, as he keeps a “very bullish” outlook on the Philippine economy under the Duterte administration.
Mr. Villar, whose businesses include property and retail, expects the economy to continue growing under President Rodrigo R. Duterte.
“I am very optimistic. I believe this is a president who is going to be the best president we have ever had. I think the economy will boom continuously. Kaya gusto ko sakyan (I want to ride on this), we will be launching more projects. We adopted a very conservative stance in the last six years. Now, I am adopting a very bullish stance,” he said in an interview with BusinessWorld at the Evia Lifestyle Center, along Daang Hari, Las Piñas City on May 16.
His listed holding company Vista Land & Lifestyles, Inc. is building more shopping malls in the next five years, mostly located near its existing housing developments.
“Marami kaming lupa na nabili namin ( We have land which we bought) in the last 30 years… The value of these properties have gone up significantly. Naglalagay kami ng malls ngayon (Now, we are putting up malls). It is the implementation of a long- term vision of putting up malls in our housing developments,” the Vista Land chairman and founder said.
By the end of 2018, Mr. Villar targets to have 40 Vista Malls, which he envisions as more modern and spacious than rival malls, with better amenities and cinemas.
He shrugged off concerns there are now too many malls in the metropolis.
“Sa akin, market ko na ’ yan. Remember sa Camella, we build a community, then the mall. Eh walang nagbi- build, kaya ang tingin ko ngayon there is a need to bring the malls closer to the people. We’re taking advantage of the expansion of the communities (That’s my market. Remember with Camella, we build a community then a mall. Nobody is building, so I think there is a need to bring the malls closer to the people),” he said, noting other malls are located in central locations which usually have a lot of traffic.
Mall expansion fueled the robust growth in Vista Land’s leasing revenues for the first quarter. The leasing business accounted for 22% of its first quarter net income, as leasing revenues surged by half to P1.44 billion from P961 million in the prior year period.
In the first three months of 2017, Vista Land’s new malls added 70,000 square meters (sq.m.) of gross floor area (GFA), bringing the group’s commercial assets portfolio’s combined GFA to 951,533 sq.m.
As for the real estate segment, Vista Land recorded P7.11-billion sales for the January to March period, up 10% from P6.4 billion a year ago. The company said this was driven by “the increase in overall completion rate of sold inventories in its business units, particularly Vista Residences, Crown Asia and Camella Homes.”
“Sa market namin, wala kaming kalaban sa horizontal. Our sales is almost dependent primarily on the projects that we’re launching. We’re launching a lot more projects now,” Mr. Villar said, but declined to give details.
RETAIL EXPANSION
Alongside the property expansion, the Villar group is also focusing on growing its retail business under All Value Holdings Corp.
Mr. Villar expects remittances from overseas Filipino workers and the flourishing business process outsourcing industry to continue to drive consumer spending.
“Booming ang retail ko ( Our retail business is booming). I’m very confident on my retail business… We are very lucky that we’re profitable… Kapag ikaw lang ang retail sa mall mo, kikita ka ( When you’re the only retailer in your mall, you’re sure to be profitable),” he laughed.
AllHome is the full- service home furnishing and improvement store that serves as the anchor tenant at Vista Malls, although it also has several standalone branches.
Since launching its first store in 2013, the AllHome branch network has grown to 12, as it rides on the continued growth of the residential sector.
“By end of next year, we will have a minimum of 30, up to 40, by 2019… I think AllHome provides everything you need in one place. I want to spread this nationwide. At a minimum, I want 50-100 branches in the next few years,” he said.
All Value’s portfolio also includes toy specialty retailer AllToys; AllDay Supermarket; convenience store chain AllDay; department store AllShop; AllElectronics; Coffee Project; and bakeshop Bake My Day, among others.
For Coffee Project, Mr. Villar said he has always loved coffee, so it was an easy decision to go into the cafe business.
His goal is to put up between 10 and 20 Coffee Project branches every year.
“If I go into something, it has to be something I love… I know coffee and kung ano ang magandang (the good) ambience for coffee, so why not? Nag- click ( It clicked) and now we have 15 branches and we will end the year with another 8-10 branches,” he said.
The rollout of the firm’s AllDay convenience stores is also continuing. For now, the 70 existing stores are all owned by company, but Mr. Villar has plans to start franchising by next year.
“We should be able to roll out and start franchising next year,” he said.
CONFIDENCE IN DUTERTE
Meanwhile, Mr. Villar said his companies do not get any government contracts, addressing criticism that there is a conflict of interest since his son Mark is the head of the Department of Public Works and Highways (DPWH).
“They said, conflict of interest, but we don’t get any contracts from the government. Wala. Wala kaming conflict kasi akala nila may contracts (There’s no conflict. They think we get contracts)… I don’t need any contracts from the government,” he said.
“Marami talagang plano ang DPWH, DoTr ( Department of Transportation). Kami wala kaming pakialam sa kanila kasi our plate is full din. Puno rin kami. ( We’re not getting involved because our plate is full, too.)”
Mr. Villar expressed support for the government’s massive infrastructure push, saying he believes the Duterte administration will be faster in implementing projects than the previous administration.
“His economic policies are stable, contrary to what people think. Kasi he’s focusing on peace and order, drugs, and Dutertenomics — ‘Build, Build, Build,’” he said.
The Duterte administration has boasted that the next five years will be the “golden age of infrastructure” with around $168 billion spent on over 5,000 projects such as roads, airports and trains nationwide.
“I cannot talk about beyond the term of Duterte but at least for the next five years, I am very bullish,” Mr. Villar said.