Fil-Estate disposes assets to raise cash for future projects

MANILA, Philippines - Listed real estate firm Fil-Estate Land, Inc. is selling high-value properties to raise funds without having to tap the debt markets. Fil-Estate chairman Robert John L. Sobrepeña said his company is selling parts of its prime properties in Baguio City, Boracay and Southwoods to obtain as much as P1.5 billion in cash starting this year. The fund raised in the selling spree will allow Fil-Estate to develop new projects and cut debt levels. Fil-Estate currently owns LIM Asia Special Situation Master Fund Ltd. $12.5 million. The company also has a $25-million convertible bond with LIM Asia Arbitrage Fund, Inc. The debts were earlier tapped to finance Fil-Estate projects including Camp John Hay Suites and Forest Cabins in Baguio, the Boracay Resort Villas in the Visayas, and Cathedral Heights in Quezon City. Sobrepeña said Fil-Estate was badly burned when it aggressively pre-sold residential units before and even after the 1997 Asian financial crisis. "We're staying away from that. During a crisis, (pre-selling) cannot be sustained. We were the most aggressive (property firm) before but we paid a price for that. We were the hardest hit," Sobrepeña added. Fil-Estate has also entered the mid-market housing segment as it cut spending for high-end projects. Sobrepeña said Fil-Estate has earmarked P2 billion to P2.5 billion for capital spending in 2009, which will develop projects in five sub-groups - residential or family-oriented developments, commercial and business process outsourcing campuses, leisure and investment-type homes, professional services and corporate social responsibility. - GMANews.TV