Leading mass housing developer 8990 Holdings has secured enough land inventory to unlock P201 billion in potential real estate sales across the country in the next seven to 10 years.
By next year, 8990 expects revenues and earnings to return to its prepandemic trajectory as the economy rebounds from the havoc created by the prolonged pandemic.
During the company’s stockholders meeting on Friday, 8990 chief operating officer Ace Sotto reported the company had now acquired 670.91 hectares of land inventory, bulk of which is located in the Visayas, with 396.66 hectares. In Luzon, the company has 170.4 hectares, and in Mindanao, 103.85 hectares.
Bulk of revenue
Despite the smaller inventory in Luzon, home to the National Capital Region, 8990 expects to generate P103 billion or bulk of projected revenues in the next decade.
About P91 billion was projected to be unlocked from Visayas, while P7 billion was estimated to be generated in Mindanao over the same period.
At a press briefing after the stockholders’ meeting, 8990 chair Mariano Martinez Jr. said the company was expecting sales revenues to hit P20 billion this year, having already achieved P10 billion in the first semester.
For 2022, Martinez said 8990 hoped to exceed this year’s performance. He added there would also be growth prospects beyond what would be generated from the existing land inventory.
“That is not to say that we won’t buy any more land or won’t do any more joint ventures,” Martinez said.
Martinez expects 8990’s current land inventory to further expand in the future. On the current geographical distribution, currently heavily skewed to the Visayas, he explained that this was due to an opportunity to acquire a company with massive land. “But generally, as a rule, we want to buy equal proportions of land in all three regions, because the customers are equally distributed,” he said.
Higher priced in Luzon
Luzon is expected to contribute more to future sales revenues because the developments there, including residential condominium towers, were higher priced.
While 8990 expects to still mostly serve the mass market, the company has also started diversifying to higher-income residential developments.
Despite the lockdowns, 8990 has seen a strong recovery this year. It reported a 133-percent year-on-year jump in first semester net profit to P3.46 billion, while revenues doubled to P10 billion.