RLC forms unit for infra-related business

Gokongwei-led Robinsons Land Corp. (RLC) is diversifying its revenue stream through the creation of a new unit devoted to infrastructure and integrated development, including the setting up of warehousing facilities to cater to the logistics requirements of the growing domestic economy.

This new infrastructure and integrated development (IID) business unit will be the fifth business division of the property company, RLC president Frederick Go said in a recent interview with Inquirer. The other four are shopping mall, residential, office and hotel development.

“This [IID] is the business unit that will look for and bid for government infrastructure projects, reclamation projects, big mixed use complexes and real estate-related infrastructure projects,” Go said.

For purely infrastructure plays, Go said it would likely be the turf of parent conglomerate JG Summit Holdings but infrastructure projects with real estate components would be under the new unit.

The new unit has so far undertaken three major projects, Go said.

The first project is the 18.5-hectare former Mitsubishi Motors compound in Ortigas. This property was won by RLC in a bidding in 2015.

Another project under IID is the Bridgetown Business Park along C5 Road near the Ortigas area.

The third is a warehousing hub project in Parañaque, to be leased out to businesses.

“We’re entering the warehouse business. We’re now building our first warehouse facility in Parañaque,” Go said. “We just want to try out this business.”

Prior to the creation of the new unit, RLC’s operations were divided into four business divisions. The commercial centers division develops, leases and manages shopping malls throughout the Philippines. As of its last fiscal year that ended on Sept. 30, 2016, RLC operated 44 shopping malls. This segment accounted for 45 percent or the biggest bulk of RLC’s revenue.

The second biggest business unit of RLC in terms of revenue contribution is the residential division, which develops and sells residential developments for sale. As of end-September, this unit has completed 79 residential condominium buildings/towers/housing projects. This unit accounted for 34 percent of RLC’s revenues last year.

The third unit is the office buildings division which develops office buildings for lease. As of end-September, this division has completed 13 office developments, located in Metro Manila, Cebu City and Ilocos. The unit accounted for 13 percent of revenues in the last fiscal year.

The last business unit is the hotel division which accounted for 8 percent of revenue last year. As of last fiscal year, it had a portfolio of 15 hotel properties under the three brand segments, namely: Crowne Plaza Manila Galleria/Holiday Inn Manila Galleria under the InterContinental Hotels Group, Summit Hotels and a network of 10 budget hotels under the Go Hotels.