Megawide banks on affordable segment strength

Megawide Construction Corp. is focusing on building its affordable property portfolio this year as surplus inventory in the middle-income category remains a challenge for developers.

Edgar Saavedra, president and CEO of Megawide, told reporters last Friday that half of the company’s P2-billion capital spending target for the year would go to its real estate venture under PH1 World Developers Inc.

The other half will go to the group’s construction business, Saavedra said.

The Megawide Group began its foray into the real estate market in 2023, when it acquired PH1 from affiliate firm Citicore Holdings Investments Inc.

PH1’s main projects include horizontal residential developments in the provinces of Bulacan and Cavite.

While Megawide has yet to disclose its target areas for new residential developments, Saavedra hinted that these would likely still be within the Greater Metro Manila area.

This comes as an oversupply of condominium units persists, particularly in the middle-income segment in the National Capital Region.

For the part of Megawide, the middle-income segment comprises only a fifth of its property portfolio, according to Saavedra.

“In our own development, we will be focusing on the lower-income market, or [those units worth] P2.5 million to P3.5 million,” he said.

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Real estate investment management firm Colliers Philippines found in an earlier report that in the third quarter of 2024 alone, there were 27,200 unsold condominium units in Metro Manila.

Of the unsold units, 32 percent are intended for the lower- middle-income segment.

Overall, Megawide is expecting a top line growth of up to 30 percent this year, expected to be buoyed by its construction business.

The group’s major projects include the Parañaque Integrated Terminal Exchange, Metro Manila Subway System, and the Malolos-Clark Railway.