Property giant Ayala Land Inc. has raised P3.5 billion from the sale of commercial lots in the Food Terminal Inc. property in Taguig City in the first quarter, in line with its plans to unlock values from the 74-hectare landbank acquired from the government last year.
The sale of FTI lots, now called as “Arca South,” comprised the bulk of the P4.1 billion in revenues from the sale of commercial lots booked by ALI in the first three months which, in turn, rose by 348 percent year-on-year.
“There will be a few more programmed [sales] towards the end of the year. That will complete the allocation for commercial lot sales,” ALI chief finance officer Jaime Ysmael said in a press briefing last week.
ALI earlier announced that it had started selling commercial lots in FTI with sizes typically ranging between 2,500 and 3,000 square meters based on a headline price of P150,000 to P155,000 per sqm. This was intended not only to generate liquidity and monetize part of what ALI paid for FTI, but at the same time accelerate the rate of development in the complex.
FTI is the single biggest property acquired by ALI since taking over the Bonifacio Global City project in 2003. This accounted for the bulk of the company’s landbanking cost last year.
ALI earlier estimated that its acquisition price of FTI per square meter was a little over P32,000, a significant discount to Makati and Bonifacio Global City land values. ALI won the property through a public bidding with a net present valuation of P23.9 billion. but total cost is estimated at P27 billion when value-added tax is included.
Ysmael said ALI would keep 50 hectares of Arca South in its own portfolio. “We will develop these on our own either by ourselves or with joint venture partners, and that’s where we’ll introduce mixed-use development, predominantly residential but with strong office, retail or even hotel components,” he said.
It was earlier reported that ALI had given an average discount of 10 percent to the commercial lot buyers because a lot of them availed of an early payment package. The buyers can use these lots to put up offices, a vertical school, hotel, retail center or even a residential project.
The Arca South masterplan, which will likely take 10 to 15 years to develop, is similar to ALI’s “Vertis North” project, a large-scale mixed-use urban hub comprising about 45 skyscrapers at the heart of what is envisioned to be the central business district of Quezon City.
But unlike the skyscrapers in nearby BGC, the typical height of the FTI buildings will only be around nine storeys. The height restriction is due to its proximity to the Ninoy Aquino International Airport, at present the main international gateway to Metro Manila.
The development model in FTI is unique and, to gain additional areas, ALI is planning a below-ground type of main highway, something that has been done in other countries. This would allow ALI to recover and maximize space.
The lack of access points to FTI is seen to be addressed by an intermodal transportation terminal hub that the government plans to implement in the complex. This six to seven-hectare terminal hub is expected to be finished during the term of President Aquino, which ends in 2016.