Hotel business grew faster during the period as Megaworld expands hotel portfolio
Megaworld, the Philippines’ biggest developer of integrated urban townships, achieved a net income of P7.51-billion during the first half of 2018, 12% higher than the P6.69-billion it achieved during the same period the previous year. Net income attributable to parent company’s shareholders also recorded a 13% growth to P7.25-billion in the first half of this year from P6.44-billion during the first six months of 2017.
The property giant’s earnings for the first two quarters of the year was buoyed by strong results from all its core businesses, with the hotel business having posted record growth during the year.
Megaworld’s hotel businesses grew 10% from P648-million during the first half of 2017 to a record P715-million in the same period this year.
The company recently opened Savoy Hotel Manila in Newport City, adding 684 hotel rooms in its total inventory of 1,744 rooms as of end-2017.
Before the end of the year, the company is set to open two new hotels, the 126-room Twin Lakes Hotel in Tagaytay and the 94-room Lucky Chinatown Hotel in Binondo, Manila, bringing its total hotel inventory to 2,648 rooms by year-end.
“We are ready to supply more rooms to support the government’s goal of 10 million tourist arrivals by 2020. We are in key tourism areas like Cebu, Boracay and Tagaytay,” says Francis Canuto, senior vice president and treasurer, Megaworld.
Megaworld introduced the ‘condotel’ concept in 2012, with Belmont Hotel Manila, Savoy Hotel Boracay and Savoy Hotel Newport as among the first projects that were launched. Since then, due to the brisk sales of condotel properties, the company launched new condotels in Cebu and Manila, particularly in Westside City at the bustling Entertainment City.
The ‘condotel’ concept allows buyers to purchase units which will be operated as a hotel. The buyer earns from the hotel operations and enjoys ‘time-sharing’ privileges in the use of the hotel rooms and facilities every year.
In 2017 alone, ROI percentage given to the owners of Belmont Hotel Manila for its first year of operations stood at 7.4%, higher than the 6% target set by the company to its owners.
“There is so much potential in this business, and this has also contributed to our bottom line. As a pioneer of this condotel concept in the Philippine real estate industry, we hope to bring in more innovations to this unique offering,” reveals Canuto.
The company’s rental business, which include office, malls and commercial space leasing, also posted another record growth during the first half of the year. Rental income soared 17% to P6.79-billion this year from P5.83-billion during the same period last year.
In its Lifestyle Malls business, Megaworld opened its first full-scale mall outside of Luzon – the Festive Walk Mall in Iloilo Business Park. It also opened three new community malls: The Village Square in Alabang, Three Central and San Lorenzo Place, both in Makati City.
For its office business, Megaworld’s office space inventory stood at 1,013,000 square meters with more office towers remain in the pipeline.
The company’s residential business, on the other hand, saw a 9% growth year-on-year during the period, reaching P18.22-billion this year compared to last year’s P16.77-billion.
Megaworld Group launched new residential projects during the first half of the year: a tower of Park McKinley West in Fort Bonifacio; Chelsea Parkplace in Capital Town Pampanga; Bayshore Residential Resorts Phase 2 and Gentry Manor in Westside City; Tulip Gardens in Southwoods City; and The Fifth in Ortigas.
As of end-May this year, Megaworld already recorded P73-billion in reservation sales from its residential developments in its numerous townships and integrated lifestyle communities.
“Megaworld consistent growth across all business segments is a clear indicator of where the company is going, and we are continuously focusing on putting better value to our customers through our programs on innovation and design, digital technology, smart mobility and connectivity as well as environmental sustainability,” explains Canuto.
During the last 29 years, Megaworld has grown into the country’s largest developer of integrated urban townships and integrated lifestyle communities across the country, the concept that it has pioneered in the Philippines. It has built over 660 residential developments, 54 office towers and 17 lifestyle malls scross its 23 masterplanned development covering more than 4,000 hectares of land around the country, which include: Eastwood City in Libis, Quezon City, (18.5 hectares); Newport City in Pasay City (25 hectares); McKinley Hill (50 hectares), McKinley West (34.5 hectares), Uptown Bonifacio (15.4 hectares) and Forbes Town (5 hectares), all in Fort Bonifacio, Taguig City; The Mactan Newtown in Lapu-Lapu City, Cebu (30 hectares); Iloilo Business Park in Mandurriao, Iloilo City (72 hectares); Sta. Barbara Heights in Sta. Barbara, Iloilo (173 hectares); Boracay Newcoast in Boracay Island (150 hectares); Twin Lakes in Alfonso, Batangas near Tagaytay (1,300 hectares); Arcovia City in Pasig City (12.3 hectares); Southwoods City in the boundaries of Cavite and Laguna (561 hectares); Davao Park District in Lanang, Davao City (11 hectares);Alabang West in Las Piñas City (62 hectares); Eastland Heights in Antipolo, Rizal (640 hectares); Suntrust Ecotown in Tanza, Cavite (350 hectares); Maple Grove in General Trias, Cavite (140 hectares); The Hamptons Caliraya in Lumban-Cavinti, Laguna (300 hectares); The Upper East (34 hectares) and Northill Gateway (50 hectares) both in Negros Occidental; Capital Town Pampanga beside the Pampanga Provincial Capitol in the City of San Fernando (35.6-hectares); and Westside City in the Entertainment City in Paranaque City (31 hectares).