Megaworld grows office business even during pandemic

MEGAWORLD, the country’s leading developer of integrated urban townships, posted a 34 percent drop in its net income during the first half of the year, from P8.9 billion to P5.9 billion.

Consolidated revenues for the first six months declined by 25 percent year-on-year to P23.8 billion from P31.7 billion last year.

The company, on the other hand, recorded P2.1 billion net profit during the second quarter this year, a 56 percent decline from P4.8 billion during the same period last year, as the country was reeling from the impact of the nationwide lockdown that affected most businesses.

Kevin L. Tan, chief strategy officer of Megaworld, said they already anticipated a decline in our earnings in the second quarter.

"What actually surprised us was the fact that the drop wasn’t as bad as we have expected it to be and it remains manageable," he said.

Leasing revenues from Megaworld Premier Offices, the company’s office leasing arm, was up 10 percent during the first six months from P5.1 billion last year to P5.6 billion during the same period this year.

Contribution of Megaworld Premier Offices now stands at 78 percent of the company’s total rental income, which mitigated the impact of partial operations of Megaworld Lifestyle Malls due to the pandemic.

This year, the company is set to complete construction of five new office developments in its various townships, particularly in Iloilo Business Park in Iloilo City; Arcovia City in Pasig City; Westside City in Parañaque City; McKinley West and Uptown Bonifacio in Taguig City, adding around 213,000 square meters of completed projects in the company’s leasable office portfolio.

To date, these projects are already 90 percent pre-leased on the average.

Megaworld is expected to end the year with 70 completed office

developments covering 1.4 million square meters of leasable office inventory, excluding those that have already been sold.

Megaworld’s rental income for the first half of 2020 declined by only 11 percent at P7.2 billion, while hotel revenues were down 29 percent to P917.9 million from P1.3 billion. Megaworld Hotels, which currently operates 10 hotel properties with around 3,500 rooms under its homegrown brands of Richmonde, Belmont, Savoy, Hotel Lucky Chinatown and Twin Lakes Hotels, continued serving pre-booked guests from business process outsourcing companies, as well as balikbayans during the lockdown.

Even as the lockdown limited selling activities for residential projects, Megaworld’s reservation sales during the first half of the year reached P38 billion, which peaked during the second quarter when most parts of the country were placed under enhanced community quarantine.

Real estate sales during the first six months reached P14.3 billion, reflecting a 29 percent decline from P20.2 billion during the same period last year, as the company implemented "more flexibility" in payment terms during the quarantine period.

To date, Megaworld has 26 master-planned integrated urban townships, integrated lifestyle communities, and lifestyle estates across the country, namely: Eastwood City in Libis, Quezon City, (18.5 hectares); Newport City in Pasay City (25 hectares); McKinley Hill (50 hectares), McKinley West (34.5 hectares), Uptown Bonifacio (15.4 hectares) and Forbes Town (5 hectares), all in Fort Bonifacio, Taguig City; Lucky Chinatown in Binondo, Manila (3 hectares); The Mactan Newtown in Lapu-Lapu City, Cebu (30 hectares); Iloilo Business Park in Mandurriao, Iloilo City (72 hectares); Sta.Barbara Heights in Sta. Barbara, Iloilo (173 hectares); Boracay Newcoast in Boracay Island (150 hectares); Twin Lakes in Alfonso, Batangas near Tagaytay (1,300 hectares); ArcoVia City in Pasig City (12.3 hectares); Southwoods City in the boundaries of Cavite and Laguna (561 hectares); Davao Park District in Lanang, Davao City (11 hectares); Alabang West in Las Piñas City (62 hectares); Eastland Heights in Antipolo, Rizal (640 hectares); Suntrust Ecotown in Tanza, Cavite (350 hectares); Maple Grove in General Trias, Cavite (140 hectares); The Hamptons Caliraya in Lumban-Cavinti, Laguna (300 hectares); The Upper East (34 hectares) and Northill Gateway (50 hectares) both in Negros Occidental; Capital Town Pampanga beside the Pampanga Provincial Capitol in the City of San Fernando (35.6-hectares); Westside City in the Entertainment City in Paranaque City (31 hectares); Empire East Highland City in Antipolo, Rizal (24 hectares), Arden Botanical Estate in the boundaries of Trece Martires and Tanza, Cavite (251 hectares). (PR)


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