Wednesday, 14 April 2010

Tan property firm, Ayala Land unit in Laguna joint venture

N. J. C. Morales

ETON Properties Philippines, Inc., the listed property firm of the Lucio Tan group of companies and the new low-cost housing arm of Ayala Land Corp. have formed a joint venture for a project in Calamba, Laguna.

Announcing the newfound alliance between the Tan and Ayala conglomerates, Eton Properties said in a disclosure: “A memorandum of understanding has been executed by and between Eton Properties and Amaia Land Corp.”

Under the deal, Eton Properties will allow Amaia Land to develop parcels of land in Calamba, covering four hectares. Affiliate firms of the Lucio Tan group own the land.

“Amaia proposes to develop [the property] under a joint venture arrangement as part of its residential subdivision project called ‘Amaia Scapes Laguna,’” Eton Properties said.

Eton Properties, the real estate unit of airline, tobacco, alcohol and banking magnate Mr. Tan, reported a sharp turnaround in finances in 2009. It posted a net income of P294 million last year from a net loss of P130.7 million the previous year.

Ayala Land’s economic housing unit Amaia Land, launched last month, is being groomed to become the biggest residential brand of the Ayala conglomerate in five years.

Ayala Land will spend P1.08 billion for Amaia Land within three years.

The first Amaia project, the 20-hectare, 1,828-unit Amaia Scapes in the city of Calamba, is expected to generate sales of P1.6 billion in four-and-a-half years.

“Eton Properties will be the development manager of the property representing the land owners,” the Tan-led company said in the disclosure.

The joint venture partners will start implementing the agreement within the next six months, the firm added.

The Amaia Land Web site describes the project’s location, which is approximately 2 kilometers (km.) from the Batino exit of South Luzon Expressway and 3.5 kms. from the city center, as “close ... to a number of major industrial parks.”

House-and-lot units will sell for P600,000 to P1.25 million each, with lot sizes of up to 75 square meters. The target market is families earning up to P50,000 a month.

The Ayala Land unit is planning six more projects in Cavite, Laguna, Batangas, Bulacan and Pampanga to put up a total of 12,000 units, competing head-on with the likes of DMCI Homes, Inc., Vista Land and Lifescapes, Inc., and PHINMA Property Holdings Corp.

The market is huge as there is an estimated shortage of 3.8 million housing units in the Philippines, primarily in the socialized and low-cost categories.

Shares in Eton Properties yesterday dipped to P3.75 each from P3.90 on Monday. Shares in Ayala Land, which recorded a 16% drop in net income to P4 billion last year, shed P0.25 to close at P14.00 apiece yesterday.

Ayala Land is operating under three major brands -- Ayala Land Premier for the high-end segment, Alveo Land for the middle-income segment, and Avida Land for the “affordable” market. Amaia Land is being marketed as a sub-brand of Avida Land.

For this year, the entire Ayala Land group is looking to launch 9,200 residential units in the market, more than triple the 3,000 launched last year.

Eton Properties, meanwhile, will launch eight new projects -- four residential, three commercial and one office project -- this year.

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