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Developers Articles

AYALA LAND TO BUILD FIRST GLOBAL CITY HOTEL

Ayala Land to build first Global City hotel
Business World 04/08/08

AYALA LAND, Inc. is building the first luxury hotel at Bonifacio Global City in Taguig together with the Shangri-la Hotels Group as it capitalizes on the booming demand for hotel rooms in the area.

The project is part of the development of the West Superblock area, which will also feature a new premium grade office building that will house the unified Philippine Stock Exchange (PSE) and a museum, Ayala Land President and Chief Executive Jaime I. Ayala said in a report.

Marivic Añonuevo, corporate business division head of the property unit of conglomerate Ayala Corp., said the four-star hotel would rise near Bonifacio High Street and Serendra.

Construction of the four-star hotel will start in 2010. It is expected to be completed a year later. "We’re also finalizing our [hotel] operator there," she added without citing investment figures. Ms. Añonuevo said the hotel would still cater to business executives since hotels aimed at this market are suffering from tight supply.

Meanwhile, Mr. Ayala said construction of the new PSE building is expected to start in the second half, making it Ayala Land’s first premium headquarters-type office building project since 1998.

He noted that land values at Bonifacio Global City had nearly doubled in the past two years, almost close to land values in some areas of the Makati central business district.

"[At Bonifacio Global City], value appreciation has been even sharper as our priming activities continue to bear fruit and attract more and more locators and land purchasers," he said.

Ayala Land will also co-develop a 7,377-square meter property at the corner of Ayala Center in Makati. The $153-million project, which Ayala Land signed with the Kingdom Hotels Group in March, is expected to kick off the redevelopment of the area.

The venture will include the development of a 300-room Fairmont Hotel, a 30-suite Raffles Hotel and 189 Raffles-branded private residences.

Ayala Land has earmarked P24.3 billion in capital expenditures this year, P10 billion of which it plans to raise through bank loans and bond issuance. Of the total budget for 2008, only 1% will go to the hotel business, which is categorized under the company’s support businesses along with property management services.

Ayala Land posted a 13% growth in net income in 2007 to P4.4 billion, while consolidated revenues inched up by 1% to P25.7 billion from the year earlier.

Controlled by one of the country’s old rich families, Ayala Land hit the front pages of newspapers last year when a section of its premier shopping mall, the Glorietta, exploded. The police blamed the incident on building administrators, but the company suspects foul play.

On top of the mall blast, one of Ayala Land’s units, Avida Land, lost a case where it had been accused of copying the modular design of a small player in the local property scene.

 

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