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January 16, 2018

DoubleDragon bets big on countryside growth

NEWS
DoubleDragon Properties Corp. is pushing through with its follow-on offering, as the property developer bets big on the growth in the countryside. DoubleDragon is awaiting the go signal of the Securities and Exchange Commission (SEC) to launch the P7.3-billion share sale originally slated late last year. “We are looking at launching the deal first half of this year,” DoubleDragon Chief Investment Officer Hannah M. Yulo said in a mobile phone message. A newcomer in the property sector, DoubleDragon is focusing its expansion on second- and third-tier cities, with plans to build a network of industrial leasing hubs in 40 provinces and community malls in 100 cities. “Everybody has to go there in the next two to five years so we’re getting there ahead,” DoubleDragon Co-Chairman Edgar “Injap” S ia II said in an interview. “For a new player, we have to position just in time before everybody else will. Kung mahuli ka lang nang konti, wala ka na rin because we have less resources, less everything,” he added. DoubleDragon plans to capitalize on the synergies between Central Hub and CityMalls since most of the latter’s tenants will need a commissary, cold storage, warehouse, distribution center and manufacturing facility to support their operations. The venture into industrial leasing and hotels prompted DoubleDragon to upgrade its 2020 target for its leasable portfolio to 1.2 million square meters (sq.m.) from 1 million sq.m. and revise its net income goal to P5.5 billion from P4.8 billion.
(Source: Business World, 03 January 2018)
 
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RESEARCH VIEW
DoubleDragon is banking on strong demand for industrial space. The company recently  acquired a 6.2-hectare lot in Luisita Industrial Park in Tarlac which is about 120 kilometers north of Manila. The site will offer about 32,000 sq m (344,000 sq ft) of industrial space. The project will be completed by 2020. A proof of Northern and Central Luzon’s rising viability as an industrial hub is the Xu Liang Dragon Group’s commitment to develop a 3,000-ha mixed-use special economic zone in Pangasinan, about 210 km north of Metro Manila. The firm owns China’s biggest economic zone in Xiamen province. Given the rising demand for industrial space, Colliers encourages manufacturing companies to put up facilities in industrial parks located within townships as these integrated communities are near key air and road infrastructure projects that substantially bring down the cost of doing business and serve as catchment areas for skilled manpower and a continuously rising consumer base for manufactured products.


It’s time for Clock In

NEWS
A new coworking site has opened at the Bonifacio High Street (BHS), tapping the underserved market of startups and small to medium businesses. A welcome addition to Ayala Land Inc.’s “Clock In” brand, the new site claims to be the first coworking space in the prime shopping, dining and entertainment area of BGC. Clock In was also recently merged with Fort Bonifacio Development Corp.’s (FBDC) Square One BGC brand. Clock In branches in BGC will be under FBDC, the master planner and developer of BGC. In October 2016 or prior to the launch of Clock In, FBDC opened a 1,200 square-meter coworking space called Square One BGC in Bonifacio Technology Center. This site has been rebranded to Clock In following the merger of the two brands. Patricia Gail Samaniego, Ayala Land Offices head of project development, says there are plans to set up branches in Vertis North (Quezon City), Ayala Malls The 30th (Ortigas) and Ayala North Exchange near Makati Medical Center. Samaniego says the merger of FBDC’s Square One BGC brand and Ayala Land’s Clock In brand should bring in benefits. “There are synergies by partnering with FBDC and having just one brand. It gives so much value to our members, to our tenants to give them the benefit of passport access to BGC, and Makati and to all our other locations in the future,” she says.
(Source: Philippine Daily Inquirer, 14 January 2018)
 
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RESEARCH VIEW

We see a greater demand for flexible workspace this year especially as major international co-working operators enter the local market. The challenge for developers is to adapt to the demands of the market to remain competitive in this growing office segment. Differentiation is key in surviving the surge in new coworking sites. Partnerships between stakeholders are therefore inevitable. Colliers expects more synergies among operators, developers, even schools, and food establishments in order to uniquely cater to a growing customer base


SBS buying 5-ha Coca-Cola property in Calamba

NEWS
SBS Philippines Corp., a chemical trading firm which is diversifying into the property business, has signed a deal to acquire a five-hectare property with warehousing facilities used by beverage maker Coca-Cola in Calamba, Laguna, for P520 million. Through subsidiary Lence Holdings Corp., SBS entered into a binding commitment with The Coca Cola Export Corp.—Philippine Branch and its related parties for the acquisition of warehouse facilities and property lot at Silangan Industrial Park in Barangay Mapagong, Calamba City. The property includes ambient and cold storage facilities, machinery and other building improvements. “The facility will be used in the warehousing and distribution operations of the corporation to serve as a key distribution center for regional market customers south of Metro Manila,” SBS said in a disclosure. “Given that SBS customers are looking for savings, the south depot will allow greater opportunities for them to cut down on their logistics and sourcing organization, integrate the corporation’s procurement and logistic capabilities in their business processes, and promote collaborations for supply chain optimization to simplify their operations,” it said. “This arrangement permits the corporation to grow and diversify its income streams,” it said.
(Source: Philippine Daily Inquirer, 04 January 2018)
 
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RESEARCH VIEW

National developers have been aggressive in developing townships in Cebu as it is recognized as the premier investment destination outside of the country’s capital. Cebu has also undergone significant transformation over the past few years. Integrated communities have become popular in Cebu given the inadequate transport infrastructure in the traditional business district – the Uptown/Downtown area. The national developers were successful in developing townships in the country’s capital and have applied the same concept in Cebu. The developers are bridging infrastructure gaps and unlocking opportunities by building master-planned communities that have the potential to become major catchment areas for business activities in the province.


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