Vista Land Picking Sales Due to Strong Demand for Low-Cost and Affordable Homes

MANILA - Like other property developers, Villar-led Vista Land and Lifescapes Inc. believes that the real estate sector is on its way to recovery as its reservation sales rose steeply in the second quarter of the year.

In a press briefing on Thursday, Vista Land Vice President for Finance Ricardo Tan said the company's sales have picked up, supported by the strong demand for low-cost and affordable homes.

"We've been seeing signs of recovery in the sector with the gradual return of consumer confidence," he said.

The company's reservation sales, a leading indicator of sales revenue and overall financial performance, jumped 35% to P4.5 billion in the second quarter from P3.4 billion in the previous quarter.

Apart from stable remittance inflows and the low interest rate environment, Tan said their aggressive marketing efforts and launching of new projects over the last few months boosted Vista Land's sales takeup.

Vista Land is the holding company of 4 business units: Brittany, Crown Asia, Camella Homes and Communities Philippines.

In the first half of 2009, its core net income fell 20% to P1.29 billion from P1.61 billion in the same period in 2008 as it prepaid bulk of its dollar-denominated debts and booked a decline in revenues to P4.9 billion from P5.27 billion.

Tan said they are expecting a drop in income and revenues for the full year 2009, "coming from a high base and reflecting the weakness in sales takeup last year."

However, he said: "We remain confident about our company's prospects. We hope the property sector will continue to gain momentum for the rest of the year."
Two-thirds of Vista Land's first-half revenues were contributed by low-cost and affordable units Camella Homes and Communities Philippines, while the remaining came from middle-income Crown Asia and high-end Brittany. Tan said this trend will likely continue.

"That's why we will continue to focus on our low-cost and affordable segments. Although many developers are attempting to tap the overseas Filipino market (OFW) and compete in these segments where demand has been stable, we believe Vista Land has a competitive edge given the track record and popularity of our brands," said Tan, noting that OFWs continue to account for 60% of their sales.

Vista Land launched 12 projects in the first half of the year with an estimated value of P13 billion. In the remaining half, it plans to launch another 15, of which 75% will be located in the provinces, particularly in Batangas, Pampanga, Tuguegarao in Cagayan, Cabanatuan in Nueva Ecija, and Isabela.