Analysts: Megaworld’s foray into ultra-luxury a smart move
Megaworld Corp.’s move to join big players in the ultra-luxury space is seen as a good move to complement its existing inventory of townships and horizontal developments, especially since the segment is typically shielded from high mortgage rates.
Wendy Estacio-Cruz, research head at Unicapital Securities Inc., told the Inquirer on Friday there was also a “sustained high demand from affluent buyers.”
“This is also timely, as mortgage rates remain elevated compared to historical levels, and the high-end market is generally less sensitive to interest rates,” Cruz added.
This, after Megaworld opted to join real estate giants already deep in the ultra-luxury space, such as Ayala Land Inc. (Ayala Land Premier and Alveo Land), Shang Properties Inc. and Rockwell Land Corp.
The developer led by billionaire Andrew Tan is set to launch this year Megaworld Signature Collection, which will be managed by an entirely new group, according to Megaworld president and CEO Lourdes Gutierrez-Alfonso.
According to her, residential properties under the new brand will be “so rare” and offered only once or twice a year in select locations, particularly “scarce, trophy enclaves across the Philippines.”
“We recognize the need for us to further expand our portfolio and tap into the opportunity of the ultra high-end residential market,” Alfonso said during their annual stockholders meeting.
“This will be a rare collection of residential properties that are distinctly opulent, different from the usual Megaworld residential projects,” the CEO added.
Megaworld’s portfolio currently consists of 35 townships, as well as mid-rise and high-rise residential developments mostly in the middle-income market.
Its entry into a new segment comes amid growing demand for more expensive residential developments as companies navigate a condominium glut in Metro Manila.
Data from real estate broker Colliers Philippines showed that as of the first quarter, units in the upscale and luxury segments, or those worth at least P12 million per unit, accounted for only 5 percent of unsold inventory in the region. Those in the middle-income segment, meanwhile, accounted for 35 percent.
Alfred Benjamin Garcia, research head at AP Securities Inc., pointed out that Megaworld had the lowest inventory overhang in the National Capital Region compared with its competitors.
A vertical-focused brand specifically targeting the rich could “complement the strength of [Megaworld’s] horizontal and township developments,” Garcia noted.
