Cebu Landmasters in aggressive expansion mode

Property developer Cebu Landmasters Inc.( CLI) is looking to double its recurring income portfolio in the next three to five years as part of efforts to diversify its product offerings.

In a media briefing Wednesday, CLI president and CEO Jose Soberano III said they expect recurring income to account for 20 percent of overall revenues.

At present, recurring income only comprises 10 percent of the firm’s overall revenues, Soberano said.

Soberano said this would be fueled by the company’s expansion plan in the Visayas and Mindanao area, as it plans to be the most preferred local developer in the region.

“That will gradually build up until it reaches 20 percent share of the total revenue pie,” Soberano said.

The company is mainly engaged in residential development, with its rental/leasing business only accounting for 19 percent of its project inventory.

CLI currently has a portfolio of 28 projects in various stages of construction, more than half of its inventory falls under the vertical residential category.

The office/ commercial segment only comprises 17 percent of the firm’s project portfolio, while hotel only accounts for two percent.

CLI earlier announced it was spending P12 billion for its expansion this year with 11 projects across the VisMin region slated for launch.

Franco Soberano, CLI senior vice-president and chief executive officer, said the firm is targeting to have 100,000 square meters of net leasable area in the next few years, given the number of office, commercial and hotel projects under construction and in the pipeline.

Among its new projects include AS Fortuna Center in Mandaue, Cebu, a mixeduse development which will offer 10,000 square meters of retail gross floor area(GFA), 20,000 sqm office GFA and 150 hotel rooms.

CLI is also set to launch the second phase of the Base Line Center in Cebu City, which will add a total of 5,000 sqm of retail GFA and 120 hotel rooms.

To fund its expansion, CLI plans to conduct an initial public offering to raise up to P3.8 billion.

Proceeds of the IPO will be used for land acquisition and development costs for its projects and as well as debt repayment and working capital requirements.

In 2016, the company generated a net income of P702 million, up 30.7 percent from the previous year.