D.M. Wenceslao & Associates, Inc. (DMWAI) will be spending P12 billion over the next five years to develop its mixed-use estate in Pasay City, banking on the rising demand for residential, retail, and commercial spaces in the area.

The newly listed property and construction firm said this spending plan will allow for the development of projects covering 400,000 square meters in the 204-hectare mixed-use business district Aseana City. “(Development) depends on demand, whether the market can readily absorb it. At least for the next five years, that’s the demand we’re seeing,” DMWAI Chief Executive Officer Delfin Angelo C. Wenceslao said in a press briefing in Pasay City on Thursday.

The company has alloted P3.1 billion for its capital expenditures in 2018, more than three times higher than the P850 million it spent in 2017. DMWAI is set to spend P3.5 billion for 2019 and P4.3 billion for 2020, while the balance will be spent from 2021 to 2022.

DMWAI raised P8.1 billion through an initial public offering on June 29, which will be used to partially fund its capex for the coming years.

The property firm lined up nine projects that will be completed in the next five years, three of which are residential projects with a total saleable floor area of 88,000 sq.m., and six commercial developments covering 280,000 sq.m of leasable space.

These will be added to DMWAI’s existing projects in Aseana City, most of which are leasing spaces — Aseana One, Aseana Two, Aseana Powerstation Building, Aseana Town Center, and Aseana Square.

“We have logistics companies because they want to be near the port and airport areas, BPOs, traditional, and gaming…Majority are really the traditional companies, shipping, logistics, manning companies,” Mr. Wenceslao said.

Of the 80,000 sq.m of office leasing under their portfolio, Mr. Wenceslao said around 30% has been taken up by online gaming companies. The company is limiting their exposure to the gaming industry to around 30-40% of their portfolio.

“If you take away the areas that have been leased, developed, the areas for our future pipeline that is four hectares, you’re left with roughly 29 hectares. It’s still good for, at least for our development, 10 years,” Mr. Wenceslao said.

The DMWAI executive noted that Aseana City comprises around 65% of their current land bank, with rest located in Cavite, Quezon City, and Makati. The company, however, does not intend to develop their other properties any time soon.

“Majority of the real estate development activity we see it (in Aseana) ’cause this is where the action is,” he said.

Shares in DMWAI dropped 40 centavos or 3.92% to close at P9.80 each at the stock exchange on Thursday.

Source: BusinessWorld