Torre Lorenzo mulls IPO between 2020 and 2023
PROPERTY DEVELOPER Torre Lorenzo Development Corp. (TLDC) is considering a initial public offering (IPO) between 2020 and 2023 to ensure its future growth prospects.
TLDC Chief Financial Officer Emmanuel A. Rapadas said the company would have to look at raising capital from the public to help it grow as fast as other players in the property sector in the following years.
“We will probably go public, there’s a good chance within the next five years… Anywhere between 2020 and 2023. Depends on a lot of factors. One is the market, ( next is) if we have built a credible business story, a growth story, and our readiness,” Mr. Rapadas told Business World in an interview last week.
The company current has four residential condominium projects targeting college students, namely Torre Lorenzo 1 and 2 Torre Lorenzo, both beside De La Salle University along Taft Avenue; Torre Sur near University of Perpetual Help in Las Piñas; and Torre Central near the University of Santo Tomas in España Boulevard, Manila.
TLDC has three more residential condos in the pipeline, with a third Torre Lorenzo along Taft Avenue currently under construction, a condominium near the Philippine General Hospital in Manila, and another one near the Ateneo de Manila in Katipunan, Quezon City set to be launched within the first quarter.
The property developer primarily serves the upper middle to high- end market, building projects with resort- like amenities. This includes a hotellike lobby, study areas, and leisure and sports spaces, among others.
Aside from student residences, TLDC has also recently ventured into the hospitality business after partnering with international hotel brand Dusit Thani.
With tourism’s increased contribution to the Philippine economy, Mr. Rapadas said the hotel and resorts business is becoming one of the most attractive segments in the property space.
The company expects to have four hotels under its portfolio in the next five years. TLDC is set to open Dusit Thani Residence Davao and dusitD2 Hotel, a luxury complex in Davao City, Dusit Thani Hotel at Lubi Plantation, and Dusit Princess Lipa Hotel in Batangas.
TLDC is also studying options to build more hotels in Baguio, Bohol, and Palawan, but has yet to find partners in these areas.
Entering the hospitality business will likewise boost the company’s recurring income, with TLDC earlier stating a quarter of revenues will likely come from hotel operations by 2020.
While an IPO will give the company access to public capital to help accelerate its expansion, Mr. Rapadas said it will also push the firm to be compliant with good corporate governance practices.
“We’d like to have the policies and the structures in place to ensure there is smooth succession as you hand over the reins of the corporation to the next, and it’s only if you have the right policies in place that it will continue to grow and it will continue to be profitable,” the TLDC executive said.
This year, the company looks to book P2.4 billion in reservation sales, 38% higher than what the P1.8 billion it generated in 2017. TLDC currently has a P6.2-billion inventory for student residences.