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SM Prime allots P100M for e-commerce

By Denise A. Valdez, Reporter

SM Prime Holdings, Inc. is investing P100 million to enhance its online platforms as it faces changing consumer behavior brought about by the coronavirus disease 2019 (COVID-19) pandemic.

“We acknowledge the growing popularity of e-commerce, especially during this pandemic, and SM Prime is allocating up to P100 million to accelerate our online presence with our e-commerce platform,” SM Prime President Jeffrey C. Lim said in the company’s annual stockholders’ meeting held virtually Monday.

The company will start by boosting its “Click & Collect” digital platform, which allows mall tenants to meet with customers virtually.

“We see e-commerce as a strategy to complement our malls business and connect our retail tenants to our customers,” Mr. Lim said.

SM Prime earlier said it was maintaining an P80-billion budget for capital expenditures (capex) this year despite a weaker performance in the first quarter. Its earnings slid 5% to P8.3 billion due to mall closures both in the Philippines and China.

In a phone call over the weekend, SM Prime Chief Financial Officer John Nai Peng C. Ong told BusinessWorld the company expects a bigger decline in its bottomline for the April-to-June period.

“We are still moving towards quarter end, but yes,” Mr. Ong said when asked about expecting the company’s profits to fall deeper.

“The quarantine started March 16 and significantly affected the second quarter. All of our malls were closed during that period… So you can have a sense kung ano ‘yung magiging financials natin (how our financials will look like),” he said.

Revenues from malls, which make up 86% of SM Prime’s total revenues, dropped 18% to P12.24 billion in the first quarter. Consolidated revenues stood at P12.78 billion, 14% lower from a year ago.

Despite this financial backdrop, SM Prime Chairman Henry T. Sy, Jr. said he expects SM Prime to maintain consumer demand in the coming weeks, especially with the easing of quarantine restrictions.

“SM, in the past, has faced a lot of challenges… During these times, we always see a trend in customer response. People continue to go to SM due to our flight to quality. We see the same trend today, even during the quarantine period,” he said in Monday’s meeting.

“Today, we are more prepared, responsive and resilient because we have people who continuously strategize for business growth. So as we face the new normal, we will provide facilities such as stronger Wi-Fi and safer malling areas. These will be suitable for the safety of our shareholders, and this will improve our business for the years to come,” Mr. Sy added.

The P80-billion capex this year will focus on projects that are ongoing and near completion, while projects in the pipeline will be subject to review, Mr. Ong said. SM Prime is also looking at an opportunistic land-banking for possible expansion.

While other companies have started a so-called workforce rightsizing to adapt to financial challenges, Mr. Ong said SM Prime’s direction is to support its employees and contractual partners.

“I think you can see yung ginagawa ng management (what the management is doing) is really to take care of, internally, employees, and externally, our partners. That has been the drive up to this point,” he said about the topic.

SM Prime and its subsidiaries have 11,695 regular employees as of end-2019. The whole SM Group, which includes SM Markets, BDO and the SM Store, reported some 157,288 employees in its 2019 sustainability report.

Shares in SM Prime at the stock exchange fell P2.60 or 7.82% to P30.65 each on Monday.

PLDT’s proposed US-dollar bonds gets S&P’s BBB+ rating

PLDT Inc. (PLDT) is proposing to issue US dollar-denominated senior unsecured notes, which S&P Global Ratings gave a BBB+ long-term issue rating.

On Monday, the telecommunications company told the stock exchange that it was offering investors 10- and 30-year dual tranches of the senior bonds subject to market conditions.

“We expect the company to use the proceeds to refinance debt maturing in 2020 and 2021, prepay outstanding loans, and partially finance capital expenditure,” the credit rating firm said.

As of end-March, PLDT has P205.3 billion worth of unsecured debts.

About 40% of these are held at the subsidiaries’ level. “This is below the 50% priority debt ratio threshold, over which we consider senior unsecured lenders at the parent level may be disadvantaged in the event of financial stress,” S&P noted.

With the credit rating, S&P sees a “limited” rating headroom for PLDT.

Capital expenditure is seen to remain elevated over the next few years as the company improves its network coverage, capacity to support higher mobile data traffic, and last-mile connectivity for home broadband services.

Moreover, S&P noted an increased competition in the Philippine telecommunications scene with the upcoming entry of a third-player, Dito Telecommunity Corp., in the first half of 2021.

The listed company tapped Credit Suisse and UBS as joint lead managers and joint bookrunners to arrange the investors’ call on June 15.

Meanwhile, PLDT’s enterprise group launched its latest package of connectivity and digital solutions for businesses resuming operations in the so-called “new normal.”

Beyond Fiber is a set of curated digital tools ranging from productivity and collaboration tools to e-payments and e-commerce solutions, coupled with premium fiber Wi-Fi service.

“Digitalization has now become critical for businesses that want to survive and thrive under the challenging conditions created by the COVID (coronavirus disease 2019) pandemic,” Jovy I. Hernandez, ePLDT president and chief executive officer, said in a press statement.

He said Beyond Fiber was designed “to equip businesses with digital solutions tailor-fit to the growing needs of today’s enterprises.”

The business package offers a fiber link with speeds of up to 50 megabits per second. Customers can avail of two Wi-Fi routers for both business and private use.

It also offers productivity tools by Microsoft 365, collaboration tools via MS Teams, and appointments scheduling through MS Bookings.

Moreover, Beyond Fiber protects work devices from cyberattacks through ePLDT’s Endpoint Advanced Security and provides secure and private connections via Cisco Meraki Z3. It also enables online payments through PayMaya.

The new service package is priced at P2,500 a month.

“We will have more in the months to come,” Mr. Hernandez said about the solutions initially lined up under Beyond Fiber. — Adam J. Ang

Acciona turns over treatment plant to Maynilad

SPANISH FIRM Acciona, S.A. (Acciona) has turned over a water treatment plant worth $127 million to its client, west zone concessionaire Maynilad Water Services, Inc.

In a statement on Monday, Acciona said it turned over the P6.38-billion Putatan II drinking water treatment plant located in Muntinlupa to Maynilad, after being involved in the design, construction, operation, and maintenance for the first 12 months.

The new plant treats 150,000 cubic meters of raw water per day from Laguna de Bay through advanced reverse osmosis technology, and aims to provide clean and potable water to nearly 1.5 million people in the country.

Acciona Country Manager Ruben Camba said that one of the company’s goals is to supply clean drinking water to as many households as possible.

Meanwhile, Acciona said it had clinched another contract with Maynilad on the construction of a water plant with similar requirements in the Laguna Lake area

The firm said it had previously won a contract to build a 650-meter Cebu-Cordova cable-stayed bridge that will provide a faster connection between Cebu’s industrial zone and Mactan International Airport and to Cordova’s new urban developments on Mactan Island. — Revin Mikhael D. Ochave

PHL seen to benefit from falling solar power cost

By Adam J. Ang

THE falling cost of solar energy development leading to cheaper electricity may help the Philippines, where the cost of electricity remains to be among the highest in Southeast Asia, to move further away from fossil fuel use, according to renewable energy developers.

With the growing demand for power and the present climate crisis pushing the country to shun coal and gas, there is no doubt that the Philippines need to seek clean and cheap energy sources for energy security, according to leading solar manufacturer Trina Solar Ltd.

“There needs to be more solar farm developments in the Philippines to meet the country’s growing electricity needs and to reduce the country’s dependence on fossil fuels,” Trina Solar Asia Pacific Senior Sales Director Jun Heong Ku told BusinessWorld.

He cited the technical advancements and growing operational efficiencies of industries, which brought down prices of solar equipment, like modules, mounting systems, and inverters.

The renewable energy projects in the country still lag behind the development of coal and gas-fired power facilities, which are expanding at a “faster” pace, United States-based engineering firm Black & Veatch noted.

“The Philippines has enormous potential for renewable energy but the development of coal and gas-fired power stations in the Philippines is growing at a faster pace than the development of renewable energy, such as solar,” Mitesh Patel, director of Black & Veatch Asia’s renewables business, said.

He added that the lowered cost of putting up solar energy infrastructures allows it to be “financially attractive,” even without support from feed-in-tariffs (FiT), a component of power charges that boosts the development of renewable energy.

About 23 solar projects with a total capacity of 526 megawatts (MW) were endorsed by the Department of Energy (DoE) to the Energy Regulatory Commission for FiT eligibility. Among these is the 133-MW Cadiz Solar Power Plant, which is powered by Trina Solar’s modules.

The share of renewables sources in the country’s power generation mix dropped by 20% since it last peaked at 36% in 2006, Trina Solar noted.

Solar farms, Mr. Ku said, are “much quicker” to build than fossil fuel-fired plants. It also creates high-skilled jobs and may help the country power more off-grid communities through solar-powered microgrid systems.

Black & Veatch estimated an additional 3,700 MW in solar installation to power the country by 2024.

The solar business in the country, it said, will stay afloat with recent progress on the implementation of the renewable energy market rules, the DoE’s Green Energy Option Program, and the Bangko Sentral ng Pilipinas’ rules on sustainable finance.

The adoption of net metering, or the billing mechanism which credits solar panel users for contributing excess energy into a grid, as well as the use of energy storage systems or batteries, are yet to be promoted in the country to further secure its energy needs, Mr. Ku said.

Also, solar energy adoption may be bolstered with the recent creation of bifacial modules, which generate electricity from the front-side and the back-side of the module. These are coupled with trackers that help in maximizing the amount of light the modules absorb by moving the module to follow the movement of the sun.

“It is important for the Philippines to develop renewable energy sources, so it can be more energy independent and be less dependent on overseas [sources] for the supply of fossil fuels. This will in turn help to ensure energy security,” the senior official said.

Philippine energy companies are making efforts to cut back on fossil fuel and to roll out more renewables projects.

For example, Ayala-led AC Energy, Inc. has promised to divest from coal by 2030. In the next five years, the energy company aims to add 5,000 MW in its portfolio, with half of the generated power to be coming from renewable sources.

“To meet their sustainability targets, energy companies are tapping on industry leaders with global best practices and regional execution to rebalance their energy portfolio,” Mr. Patel noted.

Unsafe at home during the lockdown

WHILE the recent lockdown restrictions were necessary to slow the spread of the COVID-19 pandemic in the country and were meant to keep people safe within their homes, many people found themselves unsafe as they were locked in with their abusers with little recourse.

President Rodrigo Roa Duterte reported in early June that there were over 3,600 cases of violence against women and children since the lockdown started in March.

The harrowing statistic is what led Avon Philippines to create the “Isolated Not Alone” campaign to “give victims of domestic violence access to the support and safety resources they sorely need,” according to a release.

The campaign’s main event will be held on June 20, 4 p.m., on the She Talks Asia and Avon Philippines Facebook pages where She Talks Asia co-founder Iza Calzado and corporate social responsibility leader for Avon Philippines Ces Francisco will discuss the campaign and how important it is to end violence against women and girls

“Aside from being a very huge health crisis, COVID-19 has also become a humanitarian crisis, the lockdown, which is our solution to flattening the curve, has placed many women and girls in danger,” Ms. Francisco said in an online media event on June 11, highlighting the importance of the campaign.

Also joining the talk on June 20 is Avon’s ambassador for violence against women Ruffa Guttierez who will talk about the importance of speaking out.

“This is a very, very difficult situation and I cannot really imagine being that woman who is locked inside the house [with their abuser] and doesn’t have any means [to call for help], but I would like to encourage that person through this forum that they speak out, to reach out,” Ms. Calzado said during the event.

The June 20 event will also include a panel discussion that will present insights on the issue, possible courses of action, and proper channels to call for help and to help. The panel will include gender equality advocate and 2005 Nobel Prize nominee Senator Ana Theresia “Risa” Hontiveros-Baraquel, journalist and Pulitzer fellow Ana P. Santos, and Chair of the board of trustees of Luna Legal Resource for Women and Children Romeo Cabarde, Jr. She Talks Asia co-founder Lynn Pinugu will moderate the panel discussion.

In the forum Ms. Hontiveros-Baraquel will talk about what domestic violence survivors can expect “once they successfully contact the authorities,” she said during the media event, adding that she used “successfully” purposefully because she acknowledges that restrictions on movement affect whether someone can even contact the authorities.

“As a starter, we need to educate our women and make them believe that no woman deserves to be treated violently or in a very abusive way… so we have to make them believe that as a woman and as a person, they are entitled to all the human rights there is in the world and no one, even the person they love, has the right to hurt them, to violate them, or to abuse them,” Mr. Cabarde said.

He added that if “they can muster that belief” then it’s easier for them to “break the cycle of violence.”

Avon Philippines, through the Avon Foundation for Women, donated P4.5 million in May to support local non-government organizations providing front-line services such as helplines and refuges. The emergency grant recipients include Luna Legal Resource Center for Women and Children, Gender Watch Against Violence and Exploitation (GWAVE), Women’s Care Center Inc. (WCCI), and ING Mababaying Aksyon (IMA) Foundation. The donation is part of a $1-million fund that provides aid for over 250,000 at-risk women and children affected by rapidly rising domestic abuse rates in 37 countries.

The Isolated Not Alone discussion will be held on June 20, 4 p.m. and can be viewed on www.facebook.com/AvonPhilippines and www.facebook.com/SheTalksAsia.

Should you know or suspect anyone who may need support against domestic violence, especially during these uncertain times, contact the following NGOs:

LUNA LEGAL RESOURCE CENTER FOR WOMEN AND CHILDREN

GENDER WATCH AGAINST VIOLENCE AND EXPLOITATION (GWAVE)

WOMEN’S CARE CENTER INC. (WCCI)

ING MAKABABAYING AKSYON (IMA) FOUNDATION

— Zsarlene B. Chua

Cebu Pacific aims to fulfill at least 10% of flight schedules this month

BUDGET carrier Cebu Pacific expects to fulfill at least 10% of its flight schedules, traveling to and from 20 domestic destinations by the end of June.

The government has allowed the resumption of local flights in areas under general community quarantine with the approval of local government units.

Listed conglomerate JG Summit Holdings, Inc., parent of the airline company, said there might be some demand for air travel within the country as it saw flights in neighboring nations to have nearly resumed.

“Travel demand will return, maybe not back to previous levels that will take a couple of years, especially on the international side, but I think there is latent demand out there,” JG Summit President and Chief Executive Officer Lance Y. Gokongwei said in an ANC interview on Monday.

“It’s just a manner of assuring our partners in government and LGUs that the country and the airlines are prepared to support safe and convenient travel,” he added.

Currently, Cebu Pacific is flying about 10% of its schedules with 2% capacity. It introduced contactless booking and installed HEPA (high-efficiency particulate air) filters in part of its safety protocols.

“By the end of the month, we intend to be flying to about 20 domestic cities…We’ll start with that first; we’ll see how the demand goes,” Mr. Gokongwei said. The company aims to fulfill up to 15% of their flight schedules by end-June.

JG Summit, which earnings plunged by 71% to P1.9 billion in the first quarter, is expecting to see “more challenged” figures in the next quarter as physical distancing measures affect the operations of its businesses.

To bounce back, the conglomerate said its businesses “have to demonstrate the capability to move with agility and force” to address the changing consumer and channel behaviors caused by the pandemic.

Meanwhile, the country’s economy may not revert to the growth level seen at the start of the year until 2022, according to Mr. Gokongwei.

“I do expect that we should begin seeing recovery beginning third and fourth quarter. I don’t expect though [that] we would be back to January 2020 numbers until maybe… 2022,” he said.

JG Summit is optimistic about its own recovery in the coming years, saying it is “well-positioned to benefit from the so-called new normal and the return of the economic growth in this country” as it remains consumer-centric. — Adam J. Ang

Bob Dylan on new album: ‘The songs seem to write themselves’

LOS ANGELES — Bob Dylan gave a glimpse into his song-writing process, commented on the death of George Floyd and said in a rare interview published on Friday that he wished he had written the Rolling Stones ballad “Angie.”

Dylan’s wide-ranging conversation with the New York Times was his first major interview since 2017 and came a week ahead of the release of his first album of original music in eight years.

But the man regarded as one of the world’s most influential singer-songwriters gave few clues about what motivated his spurt of creativity or the meanings behind the new songs that are stuffed with pop culture references from the last five decades.

Rough and Rowdy Ways will be released June 19. Dylan, 79, released three singles earlier this year, including a 17-minute track, “Murder Most Foul,” inspired by the assassination in 1963 of US President John F. Kennedy.

Dylan said the songs came from a stream of consciousness. “Most of my recent songs are like that. The lyrics are the real thing, tangible, they’re not metaphors. The songs seem to know themselves and they know that I can sing them, vocally and rhythmically. They kind of write themselves and count on me to sing them,” he told US historian Douglas Brinkley in the interview.

Referring to the death of African American George Floyd who was pinned under the knee of a white police officer in May, Dylan said it “sickened me no end to see George tortured to death like that. It was beyond ugly. Let’s hope that justice comes swift for the Floyd family and for the nation.”

Dylan revealed that he enjoyed the work of the Eagles and the Rolling Stones, some of the many cultural references on his new album.

Asked which Stones songs Dylan wished he could have written, he replied, “Maybe ‘Angie,’ ‘Ventilator Blues’ and what else, let me see. Oh yeah, ‘Wild Horses’.” — Reuters

NLEx launches 2.6-kilometer Harbor Link section

NLEX Corp. with the Department of Public Works and Highways (DPWH) unveiled on Monday the latest section of the North Luzon Expressway (NLEx) Harbor Link Segment, which the government expects to cut travel time from Quezon City to Port Area in Manila to 20 minutes.

The 2.6-kilometer (km) elevated section runs from the new Caloocan Interchange in C-3 Road to Mel Lopez Boulevard, or the former Radial Road 10, in Manila.

It expands the existing 2.42-km. Harbor Link Segment 9, which links the NLEx Interchange to Karuhatan in Valenzuela City, and the 5.65-km. Segment 10 between Karuhatan to the Caloocan Interchange.

“The expanded NLEx Harbor Link will certainly boost the government’s traffic decongestion efforts in Metro Manila and other major thoroughfares, DPWH Secretary Mark A. Villar said in a statement.

“This will be an alternative route between Quezon City and Manila. From the Mindanao Toll Plaza, motorists may now reach the Port Area in Manila in about 15 to 20 minutes,” he added.

It is expected that around 30,000 vehicles each day will pass through the expressway.

The C3-R10 section will decongest choke points along Quezon Avenue, Epifanio Delos Santos Avenue (EDSA), and A. Bonifacio Avenue in Manila, as it is expected to divert around 70% of trucks passing these roads, Mr. Villar said during the live inauguration.

The road project is part of the EDSA decongestion program under the government’s flagship infrastructure program Build, Build, Build.

“By bringing NLEx closer to the country’s central shipping gateway, we expect to speed up transport of goods as well as increased economic activities in Metro Manila and North and Central Luzon regions,” NLEX Corp. President and General Manager J. Luigi L. Bautista said.

Meanwhile, both DPWH and NLEX are targeting to complete the construction of an exit ramp towards the Navotas Fish Port Complex before end-2020. — A. J. Ang

M3 growth faster in April

MONEY SUPPLY growth logged a quicker pace in April for the second consecutive month, reflecting the impact of the central bank’s easing to lessen the economic impact of the coronavirus crisis.

Domestic liquidity or M3, the broadest measure of money supply in an economy, increased by 16.2% year on year to P13.6 trillion in April, quicker than the 13.3% growth seen in March, data from the Bangko Sentral ng Pilipinas (BSP) showed. Month on month, M3 grew 3.7%.

The central bank said demand for credit mainly fueled money supply growth.

Net claims on the central government grew 45.5%, quicker than the 21.6% logged in March. The BSP attributed this to the increased borrowings by the national government.

Meanwhile, domestic claims also expanded by 15%, faster than the 11.9% seen in March.

Net foreign assets in peso terms likewise rose 11.9%, picking up from the 9.1% pace the previous month.

Ateneo de Manila University economist Alvin P. Ang said in a text message that the faster growth in domestic liquidity came after a reduction in the reserve requirement ratio of banks.

The reserve requirement ratio (RRR) of universal and commercial banks was slashed by 200 basis points (bps) to 12% in early April in a bid to boost liquidity during the lockdown. The Monetary Board authorized cuts of up to 400 bps in the RRR of banks for this year.

BANK LENDING SLOWS
On the other hand, bank lending expanded by a slower pace amid a slump in economic activity during the lockdown.

Outstanding loans disbursed by universal and commercial banks grew 12.7% in April, easing from the upward-revised 13.6% in March, the BSP said in a separate statement on Monday.

Inclusive of reverse repurchase agreements, bank lending rose by 10.9% in April, also slower than the 14% seen the previous month.

“The deceleration reflects in part constrained economic activity following the Luzon-wide lockdown to contain COVID-19 (coronavirus disease 2019) outbreak,” the BSP said.

Production loans, which made up 87% of total credit in April, was seen as the main driver of expansion even as growth slowed to 11.1% from revised 11.6% in March.

The sustained increase in production loans was driven primarily by credit for real estate activities (20.8%); financial and insurance activities (13.9%); electricity, gas, steam and air-conditioning supply (11.2%); information and communication (29.4%); and transportation and storage (20.8%).

Bank lending to other sectors also increased in April, except for mining and quarrying (-5.3%), professional, scientific, and technical services (-18.4%), and manufacturing (-1.3%).

Meanwhile, the growth of loans for household consumption slowed to 33.3% in April from the upward-revised 36.5% seen in March as credit card, motor vehicle and salary-based consumption loans expanded slower.

“Domestic liquidity conditions have stabilized with the implementation of various liquidity-enhancing measures by the BSP. Moreover, the BSP’s various regulatory relief measures should help reinforce banks’ capacity for sustained lending, especially to affected households and businesses. The BSP expects credit activity to pick up in the coming months, as economic activity resumes with the gradual reopening of the economy,” the central bank said.

The BSP added that stable liquidity conditions have provided it space to “slowly rescale its monetary operations in the coming weeks, as the economy begins to transition towards new normal conditions.”

“This will help the BSP’s liquidity measures gain further traction by providing better guidance to short-term market interest rates,” it said.

“Going forward, the BSP will remain vigilant in monitoring liquidity and credit dynamics amid significant disruptions to economic activity. The BSP reassures the public of its commitment to deploy its full range of instruments to ensure that domestic liquidity and credit remain adequate amid the ongoing coronavirus pandemic.”

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the slower loan growth could be due to muted business activities amid the lockdown.

“Some companies reduced capital expenditures in response to the sharp reduction in economic activities at the height of the lockdown in April, thereby reflecting the slower growth in demand for loans for the month,” he said in an e-mail.

Mr. Ricafort said he expects loan growth to have picked up in May as the economy gradually reopened last month. — L.W.T. Noble

Large trove of history-making The Ed Sullivan Show archives to stream online

A TROVE of historic TV performances by The Supremes, The Jackson 5, The Beach Boys and others on The Ed Sullivan Show will be made available around the world starting on Friday under a deal to bring the program’s large archive to online streaming.

Universal Music Enterprises (UMe), a unit of Vivendi’s Universal Music Group, purchased global digital rights to the long-running US variety show and will offer full-length performances for viewing on The Ed Sullivan Show YouTube channel and EdSullivan.com.

Sullivan’s show aired on Sunday nights on CBS from 1948 to 1971. The host welcomed established and up-and-coming entertainers, comedians, athletes, dancers and others. Sullivan, who was a newspaper reporter and columnist before becoming a TV pioneer, died in 1974.

In the past, only short clips of some performances were available online through official channels, along with unauthorized low-resolution videos.

UMe said it would release thousands of high-resolution performances from the Ed Sullivan catalog over the next three years, with at least one new video posted daily.

The first batch includes The Supremes, The Beach Boys, Marvin Gaye, James Brown, and Neil Diamond.

Appearing on Sullivan’s show boosted the careers of many performers, from rock ‘n’ roll bands to country stars and Motown groups. The Supremes were featured 16 times.

In the group’s early days, “we had all the records that we have released that were not hits,” Supremes singer Mary Wilson said in an interview. “Once we made it big and we were on The Ed Sullivan Show, I knew that we had actually made it then.”

The Beatles gave their first live US TV performance on Sullivan’s New York stage in February 1964, attracting a then-record US television audience of 73 million people.

Other memorable musical acts included Elvis Presley, The Rolling Stones, and The Doors.

UMe licensed the global digital rights to the series from SOFA Entertainment Inc., the company formed by documentary filmmaker Andrew Solt when he bought the rights to the show’s library in 1990. — Reuters

Damosa Land hopeful of market recovery by 2021

By Denise A. Valdez, Reporter

DAMOSA Land, Inc. is committed to making Mindanao a competitive alternative to Metro Manila through projects across residential, office and industrial segments.

The property developer said it remains optimistic the Davao market will rebound strongly by 2021, despite the coronavirus disease 2019 (COVID-19) pandemic.

“We feel that for 2020, just like with any other market, there’s probably going to be some softening in the real estate sector. But we like to focus on the opportunities and the silver lining… 2021 I think is going to be a very strong rebound,” Damosa Land First Vice-President and Chief Development Officer Ricardo F. Lagdameo told BusinessWorld in a video call last week.

Citing real estate experts, he said there is an expected resurgence in the business process outsourcing sector after the pandemic, and cities outside Metro Manila, particularly Davao, are expected to benefit from it.

The company remains bullish, with plans to invest in new projects. Mr. Lagdameo said the growth in the office segment would result in higher demand for residential spaces as well.

Damosa Land is currently constructing an office building with about 20,000 square meters of leasable space. This is set to open in either August or September and will expand the company’s leasing portfolio to 80,000 square meters by yearend.

It is also building two residential projects that may be finished either in the fourth quarter of 2020 or the first quarter of 2021. The residential segment, Mr. Lagdameo said, is the primary driver of the company’s revenues to date.

“One segment that we continue to be bullish about, and our sales over the last couple of months will validate that, is residential. I think it is going to be good, it’s going to be resilient, not just for Davao but for the rest of the Philippines,” he said.

Damosa Land is also keen on developing industrial parks — its third largest revenue contributor after residential and office leasing. “The industrial sector is actually one of the segments that not a lot of real estate developers are in. It’s something that we see us having an advantage in, to be one of the few players that are in that space,” Mr. Lagdameo said.

The government has been pushing for countryside development with initiatives such as Administrative Order No. 18, or the moratorium on new economic zones in Metro Manila. Mr. Lagdameo said Damosa Land is preparing Mindanao to take some of these locators by putting up sites where companies may invest in.

“When companies are ready to invest, we want them to see that we have an office that they can put their offices in. We have an industrial park that they can put their factories in. That’s kind of how we want to position ourselves,” he said.

As the company expands with projects across the residential, commercial, tourism, industrial and mixed-use segments, Mr. Lagdameo said Damosa Land is exploring ways to generate capital through a public offer.

“The concept of a REIT (real estate investment trust) or an IPO (initial public offering) is something that we’re already studying at this point,” he said.

He noted, however, that these plans may not come any time soon as Damosa Land’s focus is on beefing up its portfolio. “I wouldn’t say it will happen probably in the next three years, but beyond that, personally I would like to see a public offering,” Mr. Lagdameo said.

Damosa Land currently has a landbank of close to 150 hectares located in the Davao region, comprising both raw land and land that is being developed. Its plan is to keep launching projects in the region that would make it a competitive choice against Metro Manila.

“I think Davao really has a great opportunity now to compete across the country… I think you can invest in Mindanao, you can invest in Davao at considerably less investment cost than investing in Metro Manila or even Cebu,” Mr. Lagdameo said.

“Until we’ve exhausted all opportunities in Mindanao, that’s the only time that we’ll look at others. And I think there’s still a lot of opportunities on the island,” he added.

Cebu Landmasters tests employees as they return to work

Cebu Landmasters Inc. (CLI) has started testing all of its employees for coronavirus disease 2019 (COVID-19) in its headquarters in Cebu City and its project sites in other cities in the Visayas-Mindanao area to ensure the safety of its personnel upon their return to their offices and work sites.

In a statement, the VisMin residential developer around 600 employees in Cebu City and its environs from CLI, its property management arm, and its first hotel property Citadines Cebu City would initially undergo testing to be conducted by a hospital accredited by the Department of Health.

Those in Bacolod, Davao, CDO, Iloilo, Bohol and Dumaguete will follow.

“Testing all our employees is the beginning of the long road back to normalcy as Cebu Landmasters embraces the new normal. We want our teams to feel safe at work. Testing will also allow us to identify and assist those who turn out positive for COVID-19 but may not know it,” said CLI Chairman Jose R. Soberano III.

The listed company said it would ensure social distancing at its headquarters by scheduling employees so that 50% are working on a “skeletal arrangement” at the headquarters while the rest are working from home.

It said all CLI offices throughout the region would undergo deep cleaning and misting before the return of work teams, “and regularly thereafter.”

It also said thorough disinfection of all offices is also in place. All employees will be provided with N95 masks and undergo daily health checks. A company clinic will be operated by a nurse and a doctor who will do regular visits. Company buses will also be deployed to ensure employees’ safety as they commute to and from work.

CLI said the new norm is backed by the digitization of the firm’s sales transactions. The move has allowed clients to seek, inquire and book for projects online and do payments online. The company also launched a sales promo to stretch buyers equity terms to make them more accessible to economic and mid-market buyers.

“We understand that having a stable and secure home is extremely important especially today. In CLI, we adjusted our terms to make it more accessible to our market. As a result, we are happy that demand for our residential projects remains strong in this challenging time. One of our projects in CDO, Casa Mira Towers CDO, sold over 400 units in the month of May and now is sold out,” Mr. Soberano said.

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