SMIC secures major stake in dorm builder
The country’s leading conglomerate SM Investments Corp. (SMIC) has completed the acquisition of a 61.2-percent stake in Philippines Urban Living Solutions Inc. (PULS), the company that operates a growing chain of dormitory buildings under the “MyTown” brand.
The deal recently obtained approval from the Philippine Competition Commission (PCC), the country’s antitrust body, which is mandated under its charter to ensure that big-ticket mergers and acquisitions, specifically those worth P1 billion or more, will not prejudice the interest of consumers.
“The acquisition allows SMIC to capture growth opportunities in the dormitel segment,” SMIC said in a disclosure to the Philippine Stock Exchange on Monday.
The total acquisition price was less than 10 percent of the net book value, SMIC added.
PULS, an investee company of Franklin Templeton Investments and BPI Capital Corp., currently owns and manages five buildings in Makati and BGC with over 1,000 beds, all under the “MyTown” brand. The company specializes in building 10- to 20-square meter residential units rented out near Metro Manila central business districts.
The Mergers and Acquisitions Office of the PCC said SMIC’s acquisition of a controlling stake in the dormitel chain would not kill competition in the relevant market.
Investing in dormitories catering to young professionals in the central business districts, including business process outsourcing (BPO) workers, is seen as a new growth area for property investors and developers. Across the metropolis, there is a growing pool of office workers, especially young people who had just entered the workforce, who need halfway homes since they can’t afford yet to purchase their first residence.
Based on its website, MyTown units come in four configurations, each fully-furnished with a bath, kitchenette, a desk, and smart bunk beds with ergonomic gadget provisions. MyTown buildings also have a wide range of comprehensive amenities and recreational areas.
The largest of the properties, so far, is the 700-bed MyTown New York in Guadalupe Nuevo, Makati, which is also equipped with a movie theater, game rooms, resto bars, KTV rooms, function and study rooms, and a roof deck.
Each fully-fitted room is rented out at around P17,000 monthly.
PULS was established in 2012 by a group of Dutch and Filipino ex-investment bankers.
