Ayala Land floats more ‘Homestarter’ bonds

MANILA, Philippines—Property giant Ayala Land Inc. plans to raise as much as P3 billion from the sale of “Homestarter” bonds to retail investors wishing to put up seed money to buy residential units.

This will be the fifth in a series of these innovative “Homestarter” bond instruments and the largest since the first issue was floated in 2006. The last time that ALI issued such bonds was last year.

In a disclosure to the Philippine Stock Exchange on Tuesday, ALI said it had mandated BPI Capital Corp., China Banking Corp., PNB Capital & Investment Corp. and RCBC Capital Corp. to underwrite the offering.

The bonds will be sold through a general public offering to retail investors and will be subject to the registration requirements of the Securities and Exchange Commission, the disclosure said.

These Homestarter bonds will be priced at 100 percent of face value and will mature three years from initial issue date, the disclosure added.

“Proceeds, net of issue-related expenses, shall be used by the company for general corporate purposes,” the disclosure said.

Under the Homestarter Bond scheme, which aims to boost residential sales while allowing the company to raise fresh funds, investors are required to set aside at least P5,000 a month for the next three years, or a total of P180,000.

At any time during the investment period, a bondholder may select an Ayala-developed property under various brands, such as the upscale Ayala Land Premier and the middle-income Alveo, or Avida property and apply the bond as payment. The company also has a new brand of affordable housing called “Amaia” worth P1.25 million and below.

Bond holders are given advance notice of newly launched properties being offered by Ayala Land and the option to acquire choice units. Should a buyer forego that option, cash plus interest on maturity date will be paid instead.