Villar’s Vista Land aims for industrial parks, dorms in bid to surpass 2017 growth

Villar-led property developer Vista Land & Lifescapes (VLL) reported a banner year in 2017 and this year, it expects to at least match, if not exceed, last year’s 12-percent growth in net profit.

To sustain the momentum, VLL has earmarked a larger amount of P50 billion for capital expenditures this year compared to last year’s actual spending of P37.4 billion.

VLL grew net profit last year by 12 percent to P9.1 billion as higher earnings from its leasing business complemented the growth in its core housing business.

Revenues last year expanded by 13 percent to P36 billion. Revenues from real estate development were up by 10 percent to P27.6 billion while leasing income rose by 29 percent to P6 billion.

Cash flow as measured by earnings before interest, taxes, depreciation and amortization (Ebitda) advanced by 22.9 percent last year to P15.96 billion.

“We are taking advantage of the synergies that we have unlocked between our residential and leasing businesses,” said Vista Land chair and founder Manuel Villar Jr. He added the leasing business has expanded to over one million square meters of gross floor area (GFA) by the end of 2017.

As an indicator of future revenue growth, VLL’s reservations sales continued the 12-percent expansion registered in the past three quarters to end 2017 with P64.5 billion sales.

“We remain optimistic for the industry, given the robust demand for our housing products as well as our success in our leasing business propelled by the steady growth in the disposable income, overseas Filipino remittances, sound Philippine macroeconomic fundamentals and the government’s drive to accelerate economic activities and infrastructure developments outside Metro Manila, where we have a competitive advantage given that we have the widest geographic reach around the country,” Villar said.

Last year was also a record year for VLL in terms of project launches.

“We launched 55 projects with an estimated value of P60.2 billion during the year, the highest value we have ever achieved in terms of project launches. We continued with our strategy of opening in new areas aggressively. We are now present in 133 cities and municipalities and we move closer to our target of having a presence in 200 cities and municipalities in the near future,” said Vista Land president Manuel Paolo Villar.

“As for the leasing side of our business, it now represents 28 percent of Ebitda and 24 percent of net income and this will continue to grow as we continue the expansion of our investment properties to hit 1.4 million square meters of GFA this year,” the younger Villar added.

In a press briefing, Paolo said 2018 was shaping up to be an “excellent” year for VLL as well. In terms of its bottom line, he said VLL would likely continue its double-digit growth, at the very least matching last year’s net profit performance.

The rollout of commercial space is expected to continue, allowing the company to end this year with 1.4 million square meters in GFA, 83 percent of which will come from shopping malls while 17 percent will be from business process outsourcing (BPO)-focused office portfolio. This will exceed the original target of 1.3 million in square meters of GFA.

Last year, VLL’s commercial property portfolio—consisting of 22 shopping malls, 50 commercial centers and seven office hubs—had a combined GFA of 1.06 million square meters.

Moving forward, Paolo said VLL would look at investing in more hospitality-oriented assets to ride on the Philippine tourism boom as well as in new real estate formats like industrial estates and dormitories. —DORIS DUMLAO-ABADILLA