Megawide allots P2-B real estate dev’t capital
‘We are focused on the lower-income housing market, below P3.5 million, where there’s real demand. The backlog for housing in this segment remains strong’
‘We are focused on the lower-income housing market, below P3.5 million, where there’s real demand. The backlog for housing in this segment remains strong’
Engineering and construction conglomerate Megawide Construction Corp. has set aside P2 billion in capital expenditures (capex) this year — targeting growth in real estate and construction projects despite headwinds in the mid-income property market and infrastructure delays.
In a recent interview with reporters, Megawide chairperson and CEO Edgar Saavedra said the capex will be mainly split between real estate and construction to boost the company’s overall performance.
According to Saavedra, the company remains cautious about the mid-income property market but sees opportunities in the affordable housing segment.
“We are focused on the lower-income housing market, below P3.5 million, where there’s real demand. The backlog for housing in this segment remains strong,” Saavedra said.
However, while the company pursues growth in these segments, an initial public offering for its property arm, Ph1 World Developers, is not being considered in the near term as the market has yet to fully recover from the slump.
For its real estate segment, the company has ongoing and planned developments in Cavite, Pasig, and San Jose del Monte, focusing on affordable housing to address market demand.
On the other hand, Megawide expects better results from new construction contracts signed post-pandemic. “These are new contracts, so the issues with project delays and losses tied to older contracts are no longer a factor,” Saavedra noted.
In infrastructure, the company continues to be involved in key government projects, including the Metro Manila Subway and airport developments. However, unresolved right-of-way issues are slowing progress.
Despite challenges, Megawide is projecting a 20 to 30 percent increase in top-line revenue this year, with bottom-line growth expected to outpace revenue gains. In the first nine months of 2024, Megawide reported a net income of P562 million, up 69 percent year-on-year. Revenues reached P16.3 billion, supported by cost savings and improved expense management.
Housing is probably the biggest issue affecting people the world over.
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