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Mañosa firm in talks with new investors

/ 05:10 AM September 18, 2019

Cash-strapped luxury residential developer Mañosa Properties Inc. (MPI) is in talks with potential white knights to infuse new money to complete two projects that may unlock as much as P4.1 billion in sales revenues and revitalize the family-owned corporation.

As of the filing of MPI’s petition for court-assisted corporate rehabilitation in August, MPI said that a number of investors, including general contractor and engineering firm H.S. Power Construction and Development Corp., have expressed interest in funding its unfinished projects.

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The proposed rehabilitation plan submitted to the Regional Trial Court of Parañaque hinges on the completion of the Campanilla Lane project in New Manila, Quezon City, and Tago project in Tagaytay, both of which MPI hopes to re-market and complete by 2029.

“The rehabilitation plan will be able to ensure the company’s operations and corporate survival and viability,” MPI stressed.

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MPI reckoned that the P4.1-billion projected sales revenues from these two upscale projects would be more than enough to support its operating costs and expenses for the next 10 years and fully settle its P1.074 billion in liabilities. To date, it estimated that it has a positive net worth of P114.15 million.

The property firm intends to fund the project through a co-development partnership or financial investor. Funds needed to resume and complete the unfinished projects are estimated at P470 million—whether in fresh equity or debt—which will be drawn in tranches within the first three years of implementation of the proposed rehabilitation.

MPI has mandated investment advisory firm Primeiro Partners to take the lead in sourcing funds for the unfinished projects upon approval of the rehabilitation plan, which also calls for the restructuring of debt over a 10-year period at zero interest rate.

Secured creditors, the biggest of which are Luzon Development Bank (P56.4 million) and First Industrial Credit & Co. (P47.5 million), were asked to allow a substitution of collateral with equal value and the release of excess collateral. Those holding real estate assets, including the unpaid landowners, must also allow MPI to subdivide, consolidate, re-cut and partition the land titles into condominium and land titles as deemed necessary.

MPI also owes P53.94 million to Jose Luis Alcuaz, seller of the property on which Campanilla Lane project is situated. It has P87.4 million in remaining obligations to UPCC Holdings, landowner of the Tagaytay project site.

Majority of MPI’s obligations, amounting to P565.65 million, are owed to the buyers of unfinished villas, houses and condominium units.

For both Campanilla Lane and Tago developments, MPI intends to refund the payments of the existing buyers—likewise over a 10-year period at zero interest rate—and resell units with adjusted pricing.

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Trade suppliers, on the other hand, have an exposure totaling P61.48 million.

“The market demand for high-end luxury residential townhomes and condominiums has been on the uptake and supply is limited. More so, the land prices in New Manila, Quezon City, have been rapidly increasing in the past years,” MPI told the court.

On the other hand, MPI warned that a liquidation scenario would benefit only the secured creditors, unpaid landowner/seller and UPCC shareholders with preferential claim on the mortgage properties. Under such a scenario, MPI said Alcuaz and UPCC would only cancel and foreclose on acquired properties valued at P475.14 million.

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TAGS: Investors, Mañosa Properties Inc. (MPI), residential developer
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