Lucio Tan’s Eton builds up leasing portfolio

Lucio Tan. FILE PHOTO

MANILA, Philippines—Eton Properties, the property development arm of the Lucio Tan group, aims to build up recurring income in the next five years by investing in more commercial centers, retail hubs, business process outsourcing-oriented offices and hotels.

“For 2013 and the next five years, we are focusing our efforts on growing our leasing business to take advantage of the significant prospects in the leisure, retail and BPO market in the country. We are excited to introduce novel concepts to grow our property portfolio and recurring income that will sustain the company’s growth for the long term. Alongside the shift in business directions we shall be realigning our organizational structure and business processes to better serve our target markets,” Eton chief operating officer Danilo Antonio said in a press statement on Friday.

This strategy allows the company to diversify its revenue stream and strengthen its position in the industry while simultaneously sustaining its residential development business.

While construction activities in its residential projects are going full blast, the company said that under market and design study are commercial projects, hotels and BPO offices in major key growth centers in Metro Manila.

“We are very happy with the high occupancy and lease rates in our office buildings given the strong demand from the outsourcing industry. Centris Cyberpod Three in Quezon City, the company’s sixth BPO office building, is scheduled to be completed by year end. Given the strong demand for office space, the building is expected to be pre-leased even before turnover,” Antonio said.

Office space is currently the company’s strongest income contributor. “Since the market continues to be strong, we are considering some adjustments in the Eton Centris master plan to accommodate future demand for office space and strengthen our BPO presence,” Antonio said.

The first office building, 13-storey Centris Cyberpod One, has been fully leased out to leading companies such as Wipro Technologies, Genpact Services LLC, Unisys Philippines Limited, Integrim BPO Solutions and Pascual Laboratories, among others.

The entire leasable space in Centris Cyberpod Two, the second building in Eton Centris, has been fully leased to Hewlett Packard, a Fortune 500 company.

Increased rental income from completed BPO offices, Centris Cyberpod One and Two and Eton Cyberpod Corinthian, as well as commercial projects, Centris Station, E-Life and Centris Walk and Green Podium brought up rental income by 67 percent year-on-year in the first quarter to P137.9 million.

Centris Walk is a high-end lifestyle, dining and retail center in Eton Centris, the company’s 12-hectare township project at the corner of EDSA and Quezon Avenue. Centris Station is a two-level mall that caters to the transit-oriented QC market. Green Podium at One Archers Place is a dining and retail destination that serves the requirements of One Archers Place residents as well as the students and neighboring communities of De La Salle University along Taft Avenue in Manila.

Eton is likewise beefing up its retail and commercial centers portfolio. Plans for the development of a new lifestyle mall within Eton Centris are underway. Very soon, another commercial strip will open in Eton City, the company’s 1,000 hectare flagship township project in Sta Rosa, Laguna. Dubbed Village Walk, the project will be home to restaurants and bars, brand name boutiques, convenience stores and service oriented shops.

Given the government’s thrust on tourism-related projects, leisure developments in key cities and tourist destinations are likewise being planned for the next three years.

“There is significant demand from the leisure and retirees market that we need to address. From a developer standpoint, we see the potential of this market that continues to expand,” Antonio said.