CLI starts P5-B green bond issuance
Developer Cebu Landmasters Inc. (CLI) is all set to raise up to P5 billion from the debt market this month as it prepares to expand outside the Visayas and Mindanao.
The Soberano-led company said in a regulatory filing on Monday that the Securities and Exchange Commission had approved its sustainability-linked bond issuance, representing the second tranche of its P15-billion shelf registration program.
It has a base offer of up to P3 billion and an oversubscription option of up to P2 billion in case of high demand.
The notes, which will be offered from March 10 to March 14, consist of three-year Series D bonds at a rate of 6.6348 percent per year and five-year Series E bonds at 6.9157 percent.
Listing on the Philippine Dealing and Exchange Corp. is set on March 21.
Bond offers during a monetary policy easing cycle are also attractive to investors, as they are typically promised higher yields. The current benchmark rate for overnight borrowing is at 5.75 percent, or lower than that of CLI’s offer.
According to CLI, proceeds will be used to fund its capital expenditures and the development of its pipeline projects.
In January, CLI chair and CEO Jose Soberano III confirmed that they would make their Luzon debut next year beginning with a horizontal development south of Metro Manila, entailing a P12-billion investment.
Soberano said the planned housing development would span up to 100 hectares with around 10,000 homes.
While they have yet to disclose the exact location of the project, Soberano said they would allocate around P5 billion for land acquisition.
CLI is likewise planning a two-tower condominium project in the National Capital Region, although they are still looking for a “strategic partner” before pursuing it.
Despite the weakness of the residential sector, particularly in Metro Manila, CLI chief operating officer Jose Franco Soberano noted that the market would likely “correct” this year and improve demand.
At the same time, the Soberanos said they would continue expanding in the hospitality sector in the next two years, with at least six new hotels in the pipeline.
Three projects are set to be launched this year: Citadines Davao, Radisson Red and Abaca Resort Mactan.
