Megaworld spending P55B to boost portfolio

TYCOON Andrew Tan’s Megaworld Corp. is setting aside P55 billion for capital expenditures (capex) this year in line with a plan to expand its leasing portfolio to three million square meters (sqm) by 2030.

“This year, Megaworld has budgeted P55 billion for [capex], which is an important part of our overall P350-billion, five-year capex program that began in 2023,” said Kevin Tan, chief executive officer of Megaworld parent Alliance Global Group Inc.

The budget will bankroll the development of Megaworld’s existing and upcoming townships, residential projects, and investment properties, as well as land acquisitions, Tan told stockholders on Monday.

Megaworld plans to beef up its leasing portfolio by increasing the gross leasable area (GLA) of its office spaces to 2 million sqm and the GLA for its malls to 1 million sqm by 2030. The target is 52 percent higher than its total leasing portfolio at the end of 2023.

“Growing our malls and office segments within the next six years is a big part of our continuing expansion,” Tan said.

The new office stocks will come from townships in Bulacan, Pampanga, Cavite, Bacolod and Metro Manila.

The new retail spaces, meanwhile, will be developed from Megaworld’s lifestyle mall properties in Cavite, Rizal, Pampanga, Bulacan, Bacolod, Cebu, Davao, Boracay and Palawan.

The company in 2023 grew its office portfolio GLA under Megaworld Premier Offices by 69,000 sqm to 1.5 sqm, while Megaworld Lifestyle Malls’ GLA had expanded by 33,000 sqm to 517,000 sqm by the year-end.

Megaworld said it planned to complete about 180,000 sqm of offices and 100,000 sqm of mall and commercial retail spaces toward the end of this year.

In the first quarter of 2024, the company reported a net income of P5 billion, up 10 percent from P4.55 billion in the same period last year, bolstered by strong sales from its residential, mall, and hotel businesses.

Megaworld shares on Monday rose 1.14 percent to close at P1.78 each amid a 1.42-percent advance for the benchmark Philippine Stock Exchange index.