Century Properties eyes affordable, mid-income market
MANILA, Philippines - After launching high-profile projects with celebrity Paris Hilton and the Trump Organization last year, property developer Century Properties Group, Inc. is now planning more affordable and middle-income projects.
"Essentially, we are very market-oriented and very opportunistic, so we will maintain a leading and strong foothold in the luxury segment. We are now expanding aggressively in both the middle-income and affordable segments," Century Properties managing director and chief operating officer Jose Marco Antonio told ANC.
The 26-year-old property firm has become a household name for its collaborations with Hilton as well as international brands such as Missoni Home and Versace Home.
Marco Antonio said the company may be known for its luxury projects, but it is keen on expanding its existing portfolio of affordable and middle-income projects.
"Last year, 20% of our sales was from luxury, which we would define as over P7 million, while 50% was from the middle-income, which we define as between P3.5 million to P7 million. Roughly 30% was from the affordable market, which we define as P1.2 million to P3.5 million. From that, our average selling price is actualy P3.5 million. We are known for these high-profile projects, but on a revenue base, it's diversified," he said.
Last year, Century signed contracts with landowners for nearly 2 million square meters of land, including 543,966 square meters in Quezon City, which would be suited for affordable projects.
Century is targeting overseas Filipino workers, as well as the foreign market for its projects. The company has a wide distribution network, selling in 50 countries, and will open new markets in Europe and Middle East this year.
Century chief financial officer Jose Carlo Antonio said the company leads the industry in terms of international sales. "In 2011, we did pre-sales of P18.4 billion. We are extemely strong in the international market. We did 67% (of pre-sales) of P12 billion from OFW and foreign markets," he said.
Marco Antonio added: "There are 12 million (Filipinos) now remitting over $20 billion annually and continues to grow. There is very low penetration rate internationally, so combined with opening up of new markets, this presents a strong trajectory moving forward."
For the affordable housing segment, Marco Antonio said the company is also focusing its attention on first-time homeowners.
"The Philippines is marked by a perfect trifecta of positive reasons. First, we have a very young population, close to 45% of our population is below 20. Second, we have one of the lowest home ownership rates in southeast Asia. The Philippines now has a 60% homeownership rate, versus 70% in Indonesia or 80% in Thailand. Last, the very liquid banking sector, offering long-term financing to first-time homebuyers. A lot of people are now coming into the market, able to buy their dream home," he said.
Century remains bullish on the prospects of the property business this year. Carlo Antonio said this year, the company is targeting P20 billion in pre-sales and at least P1.7 billion in net income
"We are targeting at least a 100% increase, so that would be P1.7 billion and above. We have near term visibility on that we have P25 billion of unbooked revenues and all we have to do to book such revenue is to actually spend. Aside from the audited numbers, our pre-sales for the first quarter is cracking, we are targeting P20 billion in pre-sales for 2012. We have done P5.3 billion (in pre-sales) for the first quarter," Carlo Antonio said.
In 2011, Century saw its net income growing by 382% to P866 million in 2011 from P180 million the previous year.
"We feel very confident because the market right now is marked by a lot of build-up of inventory, but one good thing that's going for Century Properties is we continue to push and differentiate our product and distribution strategy...We are the only developer that has partnered with these global brands. So we have a brand portfolio that is not matched by anyone in the industry," Marco Antonio said.
He added that Trump Tower Manila saw a 60% take-up rate in just a few months, with 30% of that coming from the foreign market.
Aside from Trump Tower Manila, Century also worked with Italian brand MissoniHome for its Acqua Livingstone residential building. Socialite Paris Hilton also worked with the company to design the clubhouse of the Azure Urban Resort Residences.
Company officials said the impact of these brand collaborations has been "tremendous," and this is seen in Century's pre-sale figures.
"It creates extreme brand awareness. We have become more of a household name in the industry... It actually gives lot of confidence to buyers. They are actually made aware that Century Properties products are of a higher level... Every Century project is memorable, exciting and would deliver good value for money," Marco Antonio said.