Biz Buzz: ‘A’ for Amaz…ing

With several conglomerates investing in the logistics industry, one would not be blamed for thinking that some of the country’s richest and most influential businessmen and families know something that the rest of us don’t.

Well—the latest scuttlebutt is true—they may very well see a trend that mere mortals can’t. At least not yet.

In particular, we’re talking about the recent disclosure of the SM group to take a significant minority stake in logistics firm 2GO, in partnership with the firm’s newly installed president, Dennis Uy.

Of course, it makes perfect sense for the country’s wealthiest family which owns the country’s largest retail network to invest in 2GO. The goal, Biz Buzz learned, was for SM to expand their retail empire far beyond the physical boundaries of their ubiquitous shopping malls. How far? Let’s just say “far enough to reach every single home in the Philippines with a postal code.”

That’s where 2GO will come in. Never mind that the firm has 40-year-old vessels that are expensive to operate and maintain. What SM wants with 2GO is its delivery network that employs thousands of couriers nationwide. That’s the firm’s crown jewel. And just imagine being able to order online any item from any SM department store, hardware, pharmacy, supermarket—or any retailer in any SM mall, for than matter—and have the item delivered to your front door.

Impressive plans? Yes.

But Biz Buzz learned that this scenario didn’t even scratch the surface. SM has bigger plans.

How much bigger? Well… how about Filipino consumers being able to order anything from a firm that is commonly known as “the world’s largest internet-based retailer,” both in terms of sales and market capitalization?

How about the country’s biggest retailer entering into a partnership with the world’s biggest online retailer, and using a newly acquired logistics firm to deliver the goods to Filipino consumers? No more waiting for weeks on end for local orders to be shipped to the Philippines from the US. And no more irritating problems with Customs examiners suddenly assessing thousands of pesos in additional tariffs on your orders or books or gadgets.

Does that sound impressive enough? Biz Buzz thinks so. The plan is at a very early stage, of course, but it is bound to happen sooner or later. Which online retailer are we talking about? We’re told it starts with the letter “A.” Amazing, isn’t it? —DAXIM L. LUCAS
D&L changes

There were major movements at the board of D&L Industries Inc. this week, led by the retirement of key figures in the company, siblings Leon and Alex Lao.

Leon, company cofounder and the “L” in D&L, and Alex will join cofounder and now chair emeritus Dean Lao, the company’s other namesake, in a new advisory board.

They will still oversee a business empire that makes and sells everything from customized ice cream and muffin mixes to specialty raw materials in the plastics industry.

Yin Yong Lao and John Lao were appointed chair and vice chair, respectively.

Moreover, D&L, led by its young CEO Alvin Lao, is getting some fresh talent.

It said former Social Security System head Corazon de la Paz-Bernardo and Lydia Balatbat-Echauz, former Far Eastern University president, joined D&L’s seven-member board as independent directors.

Their entry means that four out of seven seats in D&L are held by independent directors and three seats by women, a sign that the company is taking both corporate governance and gender diversity seriously.

“The new directors bring a wealth of knowledge and experience to the Board, which can supplement D&L’s growth and strategic direction going forward,” Leon Lao said. —MIGUEL R. CAMUS
Greenfield’s Laguna bet pays off

It looked like a long shot bet a few years ago but, more and more, the decision of the Campos family to go all-in in developing their vast property holdings in Laguna is paying off. And paying off in a big way.

That’s because the latest data from the Bangko Sentral ng Pilipinas show a 4.9-percent increase in the prices of residential properties outside Metro Manila in the third quarter of 2016 (the latest data available) compared to the same period in the previous year.

No doubt this has a lot do do with the country’s robust economy which grew by 6.8 percent last year. And this year looks just as promising with the gross domestic product expected to grow by as much as 7 percent.

Of course, among the areas outside of the capital that is experiencing rising residential property prices is Santa Rosa City, Laguna. This is hardly surprising as the land value in major residential, commercial and industrial center in southern Luzon and the most dynamic sub-region in the country today is also appreciating.

Like any other city, the rising land value in Santa Rosa City is brought about by improving and expanding infrastructure that boosts economic activity. The city known for hosting many economic zones and manufacturing plants is fast turning into a business process outsourcing hub, too.

With more businesses being established and existing ones flourishing, the corresponding employment generated draws in migrants pushing the demand for housing up. Major property developers are already building sprawling residential communities or mini-cities in the city. One of these is Greenfield City, a 400-hectare mixed-use development of the Campos family’s Greenfield Development Corporation.

Indeed, the market value of residential lots in Greenfield City rose from P8,000 per square meter in 2010 to P20,000 per square to date.

Those who got on the train early are clearly happy. For example, a residential lot at Solen Residences bought in 2010 can be sold this year by the owner with as much as 150 percent profit because its value has more than doubled since that year. In the coming years, the value of a Solen Residence unit or any property in Greenfield City is expected to continue rising as additional infrastructure will further boost Santa Rosa City’s status as a business district.

Santa Rosa City is accessible via the South Luzon Expressway, including the Greenfield City Unilab Exit, and via the Santa Rosa-Tagaytay Road, which leads to Tagaytay City. Then there’s the planned Cavite-Laguna Expressway which will be built in the next few years.

But it is not just the land value in Greenfield City and accessibility that make it a windfall opportunity for lessors. Solen Residences and the neighboring Pramana Residential Park offer ideal residential environments decked with picnic grounds, garden trails, tree-lined roads and amenities that make them ideal people looking for suburban homes.

Pramana is also the first residential park development where residents enjoy a higher-than-average exposure to nature as 50 percent of the community is devoted to expansive green spaces, playgrounds and landscaped gardens.

Both horizontal developments are right inside a suburban growth center, are near Metro Manila and leisure spots like Tagaytay, and have malls in the neighborhood like Paseo de Santa Rosa, schools and hospitals.

So yes, the Campos family has a nose from sniffing out areas that provide investors with the best returns. And thankfully for those still wanting to join the bandwagon, a property market bust seems nowhere in sight… for now. —DAXIM L. LUCAS