MANILA, Philippines – Federal Land Inc., the property development arm of tycoon George Ty’s GT Capital Holdings Inc., has raised P5 billion through the issuance of corporate notes.
The additional cash from the coompany’s second fundraising in the capital markets will help in the construction of existing projects, it said.
In a disclosure, Federal Land said it signed a P5-billion corporate notes facility deal with a syndicate of institutional lenders composed of banks, insurance companies, pension funds and trust institutions.
“Proceeds of the facility, which consists of seven- and 10-year fixed-rate notes, will be used for ongoing projects, working capital and general corporate purposes,” Federal Land said.
The property firm initially planned to issue P3 billion in corporate notes but robust institutional demand prompted the company to exercise the P2-billion over allotment option.
“The timing of this debt raising is excellent, as it enables Federal Land to capitalize on robust real estate demand fueled by the strong economic wave currently enjoyed by our country,” said Federal Land president Alfred Ty.
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It is the second time Federal Land has tapped the capital markets. In April 2011, the property firm raised P6.6 billion through a similar issuance of fixed-rate corporate notes.
Both transactions were facilitated by sole arranger and bookrunner First Metro Investment Corp., the investment banking arm of the Metrobank Group.
Given the property boom, Federal Land said it is enjoying strong growth.
“Against the backdrop of a strong economy, we have maintained a steady surge in the market demand for our high-end, middle segment and affordable projects from the western part of Metro Manila to the eastern section,” Ty said.
“The fundamentals of our company remain sound and we are committed to maintain this course,” he added.
To date, Federal Land has 35 projects composed of 11,000 units, of which 6,200 have already been sold out.
The property firm also has P14.9 billion in unbooked revenues so far, which will be recognized in the next three years.
Federal Land is spending P12 billion this year to complete existing projects. Of this, P4-5 billion will be spend for Fort Bonifacio developments.