CENTURY PROPERTIES Group, Inc. (CPG) continues to beef up its commercial leasing portfolio with the P1.9-billion buyout of a Makati-based office building from its joint-venture partner.
In a statement on Tuesday, the property developer said it successfully bought the ownership of Mitsubishi Corp. in Century Diamond Tower, an office building they completed through a joint venture that started in 2015.
Century Diamond Tower is a 41-floor office building accredited by the Philippine Economic Zone Authority with 63,000 square meters (sq.m.) of gross floor area.
The deal would add 25,000 sq.m. of floor area to CPG’s commercial leasing portfolio, raising it to a total of 137,000 sq.m.
“This acquisition effectively builds up CPG’s recurring income assets in line with our strategy of growing the company’s high-margin businesses including office leasing. This has proven to be a resilient sector by nature of longer-term leases,” CPG President and CEO Marco R. Antonio said in the statement.
Mitsubishi was CPG’s joint-venture partner through Century City Development II Corp. The two companies eventually agreed to a buyout, which was approved by the Philippine Competition Commission on Aug. 11. The deed of sale of shares was executed on Aug. 24.
“We thank Mitsubishi for the trust, the fruitful partnership and its invaluable support to this project. The completion of Century Diamond Tower is a milestone for CPG…,” Mr. Antonio said.
“We express our sincerest gratitude to our partner, Century Properties and to all parties involved in the construction and completion of the Century Diamond Tower,” added Masahiro Nagaoka, general manager of Mitsubishi’s Asia Real Estate Development Department.
Part of CPG’s strategy to balance its revenue mix is expanding its commercial leasing and affordable housing segments. The two segments accounted for 42% of its net income in the first half of 2020, up from 29% last year.
“While the current situation has affected office demand, market analysts still see office leasing as one with higher resilience among other real estate sectors,” it said.
CPG’s net income fell 36% to P458.13 million in the six months to June, as consolidated revenues declined 25% to P4.52 billion.
Shares in CPG at the stock exchange ended flat at 35.5 centavos each on Tuesday. — Denise A. Valdez
