November 6, 2024
Ayala Land Inc. (ALI), the property giant led by the Zobel family, has successfully taken over its joint venture with the Aboitiz Group, securing the Philippine Competition Commission's approval for the P1.81-billion share purchase agreement. This acquisition allows ALI to fully assume ownership of Cebu District Property Enterprise Inc. (CDPEI), a key developer of mixed-use properties in Cebu.
The transaction involves the transfer of shares held by Aboitiz Land Inc. and Aboitiz Equity Ventures Inc. (AEV), which together owned a 50-percent stake in CDPEI. Specifically, ALI acquired 1.81 million common shares held by Aboitiz Land and 16.29 million series A preferred shares from AEV, valued at P100 per share. The deal was formalized with the signing of a Deed of Assignment of Shares, as announced in separate disclosures by ALI and AEV on Tuesday.
With this move, ALI now holds full control over CDPEI, which is currently developing the 17.6-hectare Gatewalk Central mixed-use estate in Mandaue City, Cebu. The property is a central part of ALI's expansion strategy in the Visayas region. According to the company, Gatewalk Central is expected to become one of ALI’s flagship developments in Cebu, reinforcing its growing presence in the region.
The acquisition deal was approved by both ALI and AEV’s respective boards on February 29 of this year.
In related news, Ayala Land has posted impressive financial results for the first half of 2024. Driven by a surge in consumer demand and record-high revenues, ALI reported a 15-percent increase in net income to P13.1 billion. Revenues for the period expanded by 28 percent to P84.3 billion, with significant growth in property development revenues, which rose by over a third to P51.9 billion.
Residential sales were a standout, with revenues up 40 percent year-on-year to P43.7 billion. Meanwhile, income from commercial and industrial land sales increased by 20 percent to P6.3 billion.
In line with its robust financial performance, ALI launched a total of P33.7 billion worth of projects during the first half of the year. Notably, 92 percent of these projects were under ALI’s premium brands—Ayala Land Premier and Alveo Land. The company stated that over 70 percent of its planned project launches for the remainder of the year will continue to focus on these high-end segments, citing ongoing weakness in the middle-income and affordable housing markets.
Despite strong overall demand, challenges persist in the residential sector. According to data from Colliers Philippines, as of September 2024, the residential vacancy rate in Metro Manila has climbed to 17.4 percent, with approximately 27,200 unsold condominium units across the region. Notably, the majority of unsold units—32 percent—are in the lower mid-income segment, followed by 25 percent in the upper mid-income range and 24 percent in the affordable housing segment.
As a result, ALI remains focused on its premium developments, which continue to drive growth amid the broader market slowdown. The company’s strategy is aimed at capitalizing on the recovery of high-end residential and commercial properties, which are expected to remain resilient despite market challenges.