Eton Properties Philippines Inc., the real estate arm of the LT Group, is currently beefing up its recurring income portfolio as part of plans to relist at the Philippine Stock Exchange in three years.
In an interview, Eton deputy chief operating officer Josefino Lucas noted that it has already been two years since the firm’s delisting and PSE rules allows them to seek listing again Five years after its delisting.
In the meantime, Lucas said the firm is working to improve its balance sheet, raise profits and recurring income to make the company more attractive to new investors.
Lucas said relisting at the PSE will give them access to future funds. He added that the firm also wants to issue bonds in the future since “it’s hard not to have a combination of funding for growth.”
“Hopefully, we are not at the tail end (of the real estate boom) yet. If, for the next six years, we see the same trend of development, then we can catch up,” he noted.
With the firm’s focus on its leasing properties, Lucas said they expect recurring income to grow to Pl.l billion to P1.2 billion this year from P740 million in 2014.
Eton president Lucio Tan Jr. said rental income surged by 65 percent last year because of the strong takeup of office spaces among BPOs, especially in Eton Cyberpod Centris and Corinthian Cyberpod Ortigas.
“Our gross leasable area expanded by 69 percent when we opened our third BPO building and gave us a new income stream. Leases were renewed at better prices. We expect this trend to continue in the coming years because of strong demand from BPOs,” said Tan.
Lucas added that “we are confident that our rental operations will remain strong in 2015. We are experiencing high occupancy rates in our office buildings given the strong demand from the outsourcing industry and we see this trend continuing.”
With the real estate industry remaining robust, Lucas expressed confidence that interest in Eton’s projects will be sustained, providing the company with avenues of growth this year.
Meanwhile Lucas said they are in the process of doing a revised plan for Eton City so that it will have commercial and retail components that will also provide recurring income.
“We want to be able to do an integrated plan where we can assign proper land uses for the 600 hectares and therefore we can identify which commercial blocks we will start,” he said.
He noted that “Sta. Rosa is developing very quickly and we are the doorsteps. We are at the entry. As you exit SLEX it’s us. And we’re not capitalizing on that location advantage. So we’d like to be able to do something by the first quarter of next year.
“We’re looking beyond disposing properties there as a lot, and we’re looking at the future of the area as a suburban commercial district, seeing how Sta. Rosa is growing. And since the universities there are beginning to actually seriously look at their plan of development, I think it’s opportune time that we grow with their programs,” said Lucas.
Eton Properties is the real estate brand of the Lucio Tan Group, one of the biggest business conglomerates in the Philippines. Its foreign counterpart, Eton Properties Ltd, is an established real estate brand in Hong Kong and mainland China. With an extensive land bank in strategic locations all over the country, Eton specializes in high-end and mid-income high-rise and horizontal residential developments, office projects, commercial centers and mixed-use township developments.