Megaworld nets P10.6B in 2020, down 45% amid COVID-19 pandemic

Andrew Tan-led property giant Megaworld Corp. saw a high double-digit decline in its profits in 2020 due to the economic disruption brought by the COVID-19 pandemic.

In a disclosure to the Philippine Stock Exchange on Wednesday, Megaworld reported that its net income last year stood at P10.6 billion, down 45% as its consolidated revenues slipped by 35% to P43.5 billion “due to the pandemic.”

Despite the pandemic and the strict lockdown in 2020, Megaword said it closed deals for new office leases last year.

The company said around 135,000 square meters of fresh office space inventory were leased out in the company’s townships in Iloilo, Quezon City, and Fort Bonifacio.

Around 78% of these new leases are part of the expansion programs of existing office partners while the rest were taken by new client companies, it said.

“These are mostly companies operating BPOs, e-commerce, logistics, and finance. And we are very happy to see the strong interest in our office developments in Iloilo Business Park. Approximately 20% of new leases have been booked there and we even cemented our dominance in terms of market share in the Iloilo office market,” said Kevin Tan, chief strategy officer of Megaworld.

In addition to new leases, the company said it also bagged lease renewals of around 145,000 square meters of office spaces from various company tenants last year.

Megaworld said it was able to complete the construction of around 87,000 square meters of fresh office spaces last year, bringing the total leasable office inventory to 1.4-million square meters.

This excludes the office spaces that are for sale in Iloilo Business Park and Maple Grove in Cavite.

“At this point, we can say that our office business is the most stable income generator in our company’s revenue stream with or without this health crisis, and we continue to focus on the expansion of this business in the years to come and further strengthen our leadership in the country’s office property sector,” Tan said.

The company’s rental income, meanwhile, slipped by 23% to P12.9 billion, while real estate sales declined by 42% to P24.9-billion year-on-year.

Despite the effects of the pandemic to the tourism and hospitality industry, the company said its hotels business booked P1.5 billion last year.

On the residential business, the company launched P7.8-billion worth of new projects last year, particularly in The Upper East Bacolod, Iloilo Business Park, Capital Town Pampanga, and Hamptons Caliraya in Laguna.

To date, Megaworld has 26 master planned integrated urban townships, integrated lifestyle communities, and lifestyle estates across the country. —KBK, GMA News