Alliance Global spending set at P240B through 2020
ALLIANCE Global Group, Inc. (AGI) plans to spend P240 billion through 2020 to fund the organic growth of its subsidiaries and help sustain double-digit growth.
Bulk of the expenditure will be allocated to units Megaworld Corp. and Travellers International Hotel Group Inc. while the balance will go to other businesses such as Emperador Inc., Golden Arches Development Corp.
(GADC), and Infracorp Development Inc., AGI Chief Executive Officer Kevin Andrew Tan said in a speech during the company’s annual stockholders’ meeting in Quezon City on Tuesday.
Tan said Megaworld would focus on expanding residential projects and other investment properties, as well as acquiring more land bank.
For the office component, Megaworld is targeting to achieve 1.5 million square meters (sqm) of gross leasable area (GLA) by 2020 with the slated opening of projects Worldwide Plaza, World Commerce Plaza, and One Le Grand in Taguig. Upon completion, the three developments will bring an additional 218,800 sqm of GLA to the property market.
For townships, the property firm is aiming for 1.3 million sqm of GFA by 2023, with the additional areas to come from Boracay Newcoast in Aklan and Mactan Newtown in Cebu.
Travellers, meanwhile, will use the funds for the phase 3 expansion of Resorts World Manila and the development of the P121-billion West Side City township in Pasay.
Megaworld and Travellers—which both undertake the group’s hotel business—aim to support the government’s aim to reach 10 million tourist arrivals by 2020 by expanding their hotel room portfolio to 12,000 in the next few years from the existing 5,000. This September, the group will open Hilton hotel at Newport City in Pasay.
GADC—the sole franchisee of the McDonald’s brand in the country—plans to increase its store network to 1,000 branches over the next few years from 566 at present while Emperador seeks to introduce its products to new markets.
Tan added that the total spending will include P3 billion for Infracorp’s proposed Skytrain project that will link MRT-Guadalupe Station in Makati to Uptown Bonifacio in Taguig.
The Skytrain aims to service 100,000 passengers daily and cut travel time to 5 minutes from 30 minutes.
The group obtained the original proponent status (OPS) from the Department of Transportation (DoTr) in May this year but has yet to secure the approval of the National Economic and Development Authority (NEDA). If and when approved, Infracorp expects to start construction of the project in early 2019, to be completed in 2021.
“The bulk of our planned capex will be funded internally, leaving only a small portion that will need bank financing,” Tan said. “We are conscious in keeping our financial gearing to a current 38-percent net debt-to-equity.”
More infrastructure projects
In a news conference at the sidelines of the stockholders’ meeting, AGI President Kingson Sian said Infracorp was looking at four new areas in need of monorail projects, one of which will connect Eastwood in Quezon City and Santolan in Pasig.
“We definitely have other sites in mind … There are number of areas that have been identified, at least three to four areas,” he said.
AGI is also a part of the consortium bidding for the rehabilitation of Ninoy Aquino International Airport, along with
AC Infrastructure Holdings, Aboitiz InfraCapital Inc., Sia’s Emerging Dragon Corp., Filinvest Development Corp., JG Summit Holdings Inc., and Metro Pacific Investments Corp.
Last week, the consortium secured the OPS from the DoTR and is now awaiting NEDA’s nod. The companies plan to start the modernization of the airport as early as mid-2019.
AGI shares were down by 8 centavos at P12.36 each.
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