Thursday, 21 January 2010

Ayala Center redevelopment expected to cost P20 billion

Miguel R. Camus
Business Mirror

LISTED Ayala Land Inc. is betting that the property sector will continue its strong rebound as it plots a P20-billion plan to redevelop a chunk of Ayala Center into what officials have touted as among the firm’s “most ambitious” projects to-date.

The plan, to be carried out over the next five years, involves the construction of a high-end residential tower, two office buildings, a hotel and a new mall over what used to be Glorietta one and Glorietta two in Makati City.

“This [redevelopment] has been in the works for the last three to four years as we tried to see how to take Ayala Land to the next level,” said Ayala Land chairman  Fernando Zobel de Ayala in a press briefing late Tuesday.

“If you look at Ayala Center from the 1960s, this is now the third major redevelopment that we are going through. I think what is very exciting in the real estate cycle that we are going through now is the much higher level of affordability the Filipino consumer has,” he added.

He cited growing overseas remittances and low interest rates as main drivers of the confidence in the property sector. Zobel added that Ayala Land expects to sell 9,200 residential units this year from 2,500 units in 2009.

For his part, Ayala Land president Antonio Aquino noted that the redevelopment project will be funded with a combination of internal cash and borrowings. He said the firm is also anticipating the upcoming rules and regulations of Real Estate Investment Trust Law as another source of funding.

The new project will be anchored by the launch of the three-tower Park Terraces, the latest residential project under Ayala Land Premier, the company’s high-end brand.

The towers, to be built over a 1-hectare area, will start construction by the second quarter this year with turnover to clients beginning in early 2015.

The first tower will stand at 49 stories and will offer 370 units, of which a quarter will be allotted to studio and two bedroom units each, 40 percent for one-bedroom cuts and the remainder for the larger three-bedroom and penthouse units.

Prices start at P5 million for a 37-square meter studio room to P40 million for a larger 272-square meter unit.

“The configuration mix for the [succeeding towers] will depend on client preferences to be gauged [from] the first tower,” noted Tom Mirasol, head of sales and marketing of Ayala Land Premier.

Other developments are seen to complement Park Terraces, said Aquino. “This is going to be one of the of most ambitious projects that Ayala is going to be doing in terms of dramatic expansion in leasable area for our offices as well as in hotel and mall development,” he said.

Aquino said the planned office towers are seen to offer another 40,000 square meters of space while the mall will provide an additional 20,000 square meters of retail space. The hotel, which Aquino described as a businessman’s “Holiday Inn-type” of project, will offer between 250 and 300 rooms.

The company president noted that less than half of the P20-billion budget will be spent on Park Terraces and the remainder going to the retail, commercial and office space components.

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