ALI spending P100 B for projects this year

Ayala Land Inc. (ALI), the listed property giant of the Ayala Group, is ramping up its investments this year with capital spending returning to pre-pandemic level.

ALI has earmarked P100 billion for capital expenditures this year, 16 percent more than last year’s capex spend of P86.2 billion.

This is the first time since 2019 that ALI is allocating capex in the P100billion level.

ALI spent a record P110.1 billion in capex in 2018, then followed it up with P109 billion in 2019.

The amount went down to P64 billion in 2020 and 2021 due to the pandemic, and eventually picked up to P72 billion in 2022 and P86 billion last year.

“Higher is better. That means more growth,” ALI chief finance officer Augusto Bengzon said.

“We’re investing a lot so we’re increasing our capex. This is to finance the growth opportunities,” he said.

For 2024, the largest portion of ALI’s capex is allocated for its residential business at 34 percent, followed by 24 percent for estate development, and 19 percent for continuing payments on land acquisition.

Malls will have 10 percent of this year’s capex, while offices will have eight percent, and hotels and resorts will get five percent.

Bengzon said ALI intends to launch P115 billion worth of property development products this year, of which P100 billion worth are residential products and P15 billion worth are commercial and industrial lots.

“At least 80 percent of the residential launches will come from premium segment, while 20 percent will be for the core segment. We will launch 52 percent as horizontal projects and 48 percent as vertical,” he said.

In terms of location, 44 percent of ALI’s project launches this year will be in Metro Manila, while 38 percent will be in South Luzon.

Visayas and Mindanao will also get their share as about 11 percent of ALI’s upcoming projects will be located in these regions, while another seven percent will be in Central Luzon.

“In the near future, the market that we feel is more robust is the premium segment, which is why we are ready and really improving all our quality specifications to make sure that we continue to lead in that particular segment,” ALI president and CEO Anna Ma. Margarita Bautista-Dy said.

“But over the medium-term, with a country like the Philippines, we need a core to come back. Which is why now we continue to nurture our Avida brand. We continue to plan and we intend to have projects on push button mode so that if there should be opportunities, we would be very quick in being able to capture market changes,” she said.

Bautista-Dy said the core segment is where ALI would continue to participate in a big way just as soon as market conditions improve given that most of the Filipinos are in that segment.

For its commercial leasing assets, meanwhile, ALI is set to complete this year the 68,000-square-meter of malls gross leasable area (GLA), which will come from AyalaMalls Vermosa, AyalaMalls Evo City and Park Triangle.

The property giant will also open close to 100,000 square meters of office GLA with the completion of One Ayala South Tower, Park Triangle, Atria Technohub and Nuvali Technohub.