HOST: For our first guest this morning, we have Megaworld’s Kevin Tan, Chief Strategy Officer. He actually saw a booming Iloilo long before actually others did… and now, Megaworld is reaping the benefits.

Kevin, finally we have you on the show, thank you so much for joining us!

Kevin Tan: Thank you Michelle for having me.

HOST: Ok, so Kevin, your research… What does it tell about the direction of the property market? I know that leasing for example is now thirty percent of your business.
What does it tell you about the rents? What does it tell you about sales for your property developments?

KT: Well, I think our outlook is generally optimistic and property sector has remained pretty resilient even to the pandemic.

When you look at for example Metro Manila — despite the softening in demand which I think is very temporary, we do see prices remain stable. Especially for example, for condominiums in segments where Megaworld operates, we’ve seen the prices actually hold their ground, which is a good thing, considering all things being considered. For land prices, exclusive subdivisions, ours included, we’ve also seen prices go up.

Now, one of the things that the things that excite us right now though is really the growth that we are seeing outside Metro Manila especially in places where Megaworld operates in and that’s why we’re able to see these things firsthand. In places like Pampanga, Cavite, Bacolod, and Iloilo. we’re seeing robust takeups there in our horizontal and vertical developments. We’ve had several project launches last year, in the height of the pandemic.

In those areas, some of them are either 100% sold out or at the very least around 60 to 70 percent sold out today. So the demand continues to grow there and prices also continue to appreciate in those areas.

For the office segment, last year, we did a total of 270 thousand square meters of lease transactions. Half of that were new transactions, including expansions, and half of that were renewals this year. We’re looking to surpass that. We’re looking to do at least three hundred thousand square meters of lease transactions. So our general sentiment is very much optimistic and we’re actually quite excited about all the new investments that is happening actually outside Metro Manila.

HOST: Kevin, I want to talk about Iloilo — now, the brightest spot in your office leasing portfolio. You’re seeing that boom. Did it come as a surprise? I know that Megaworld started investing there as early as 2013. What did you see?

KT: Well, you know what impressed us about Iloilo was the fact the way the city was developed, the infrastructure that was put into that City, you know — they have very nice airports, very, very nice roads, sufficient and stable power supply. I mean, those are the things that really attract a lot of our investors. Another thing that strike us the most was the number of graduates that was produced by the local universities in Iloilo.

Iloilo produced anywhere from 25 to 30 thousand graduates every year. And that is a source for talent for the a growing BPO sector. That’s why we are doing very well in Iloilo. We have currently a hundred thousand square meters of office space there, comprising of 70% of the total office Market and all of that is hundred percent leased out and currently we’re building another forty thousand square meters which we will be delivering in phases starting next year.