Upscale property developer Alphaland Corp. is about to complete a P3-billion grade-A office building at the heart of the Makati central business district, which may be leased out to a single investor or sold in its entirety “at the right price.”
In a briefing on Thursday, Alphaland officials said the 34-story Alphaland Tower along Ayala Avenue would likely be completed by December this year and operational by January 2013. This brings 48,000 square meters of additional office space to the property market and opens up a new stream of recurring income for Alphaland.
The company is expecting to generate P4.4 billion from the project. Of the amount, P3 billion is expected to come from rental income spread over an eight-year period, equivalent to about P350 million to P400 million yearly. Another P1.4 billion is expected to come from the sale of some of the building space, particularly the office space on the first and second floors, and the three-story penthouse units, Alphaland director for property management and leasing Marianna Ongpin told reporters.
The plan is to lease out about 75 percent of the building space and sell the remaining 25 percent.
“We’re getting a lot of inquiries,” Ongpin said, noting that this tower was expected to attract multinational companies looking for Philippine headquarters.
The payback from the project is expected in three to four years, said Alphaland financial analyst Adrian Tan.
Ongpin said Alphaland was very lucky with the timing of project completion. “We’ll come out in the market by 2013. We will be the only inventory out in the market by then,” she said, assuming that the Zuellig building along Makati Avenue—the only other new building in Makati—would have been fully leased out by then. “Next year, Alphaland Tower is the only game in town.”
But the company is not in a hurry to sign contracts as the company chairman, Roberto V. Ongpin, is considering dealing with only a single tenant for the leasable portion, she said.
“We’re entertaining but not booking,” she said, noting that office vacancy rate in town was at a record low 5 percent based on a recent study.
She said the chairman had some potential lone tenant in mind but was also open to selling the entire building “at the right price.”
The headline price for leasing office space in Alphaland Tower is currently at P1,000 per square meter, commanding a bit of a premium over other older Grade A offices at the Makati central business district.
The whole tower is equipped with environmentally sustainable technologies that will allow tenants to drive down operating costs, with water and electricity expenses seen lower by almost 20 percent than the regular rates.
“At Alphaland Tower, reducing your carbon footprint goes hand in hand with reducing your operating expenses. The energy-efficient systems will help tenants make the most of the money spent on utilities while letting them work in utmost comfort,” said Luigi Villanueva, Alphaland Tower project director.
Such features include the unique curtain wall system to reduce solar heat gain inside the building, effectively lowering energy consumption for air conditioning and the advanced air filter technology to improve air quality and occupant well-being and productivity inside the tower.