Local credit watcher Philippine Ratings Services Corp. has maintained a triple-A rating on Gokongwei-led property developer Robinsons Land Corp.’s (RLC) debt paper.
Obligations rated “PRS Aaa” are deemed of the highest quality with minimal credit risk and suggested that the borrower’s capacity to meet its financial commitment on the obligations was extremely strong.
Such rating was maintained on RLC’s P10-billion outstanding bonds maturing in 2014.
In its rating assessment, Philratings noted that RLC was adopting a diversified business model wherein its property portfolio was grouped into two components: investment and development.
“Considering current market developments and conditions both globally and locally, RLC is now investing more in malls, office buildings and hotels while taking a more conservative stance in relation to the development of residential real estate projects. This move signifies that RLC is expected to have a more stable and strong recurring rental and lease revenue base from investment properties while at the same time pursuing opportunities through its residential development businesses,” Philratings said.
The rating firm added that sustained robust overseas Filipino remittances, the increase in consumer spending as well as an expanding business process outsourcing business were expected to boost demand for residential space going forward and would continue to support growth in the commercial centers business.
Philratings estimated that RLC would be able to expand the net leasable area of its commercial centers division to about 911,800 square meters with the completion of the ongoing development and expansion projects. It cited upcoming new malls in Calasiao, Pangasinan; Puerto Princesa, Palawan; Magnolia in Quezon City; expansion of Robinsons Bacolod and Robinsons Tacloban, as well as Phase 2 redevelopment of Robinsons Metro East within the second semester of 2011 up to the first half of 2012.
The office building division is likewise seen to expand its net leasable area by about 80,000 square meters given the completion of the Cyberscape Alpha and Cyberscape Beta office tower projects within the Ortigas business district by 2013.
Considering the growing demand particularly from local tourists for affordable accommodations, RLC’s hotels division was expecting four Go
Hotels in Palawan, Dumaguete, Tacloban and Bacolod to open by the first quarter of 2012, it said.
RLC aims to have 30 budget hotels across the country over the next five years.
As of end-June 2011, RLC has 54 residential condominiums and 31 horizontal subdivisions under its four residential brands (Robinsons Luxuria, Robinsons Residences, Robinsons Communities and Robinsons Homes).
Synergies among the companies within the Gokongwei Group were being demonstrated by the presence of affiliate merchant stores such as Robinsons Department Stores, Robinsons Supermarket, Handyman and Robinsons Appliances in RLC’s shopping centers, Philrating said.
RLC likewise believed that the Go Hotels enjoyed a competitive advantage given its affiliation with Cebu Pacific.
“There is also synergy derived from the strategy of mixed-use development. Sales of residential buildings are enhanced by buyers who want to live near malls and offices. The presence of condominium residents and office workers, in turn, increases traffic for mall retailers and would then further drive mall rental revenues,” Philratings said.