Message of Megaworld chairman Andrew Tan during the company’s annual stockholders meeting last Aug. 24
Through the years, Megaworld has contributed much to the enhancement of the country’s metropolitan skylines, with developments that cut across key elements of society — residences, office spaces, hotels, and commercial properties.
The year 2019 was no different. Building on our core values of integrity, creativity, innovation, excellence, and love for the Company, we were able to sustain the momentum of growth we’ve built in recent time and retain our position as the leading developer of urban townships and the largest office space developer and landlord in the country.
Testament to our creditable performance for the year was our net profit which amounted to P19.3 billion, a substantial increase of 22 percent from the previous year’s P15.8 billion. This was driven by a robust 17 percent year-on-year growth in our consolidated revenues to P67.3 billion, underpinned by the strong performances of all of our key business units.
Megaworld’s real estate sales registered a 12-percent growth, ending the year at P42.6 billion. Our reservation sales similarly sustained their growth momentum in 2019, ending the year at a record P149 billion. Rental income from our offices and malls exhibited another year of record growth, soaring 18 percent to P16.8 billion in 2019. Income from our hotel business, in turn, grew by 67 percent to end the year at P2.5 billion from P1.5 billion the previous year.
Despite the challenges of 2019, Megaworld was able to sustain its expansion initiatives, launching new projects while opening newly completed ones.
We not only continued our innovative approach to property development, we also aimed to level it up by laying the groundwork for digital transformation.
With a new vision statement that proudly declares, “We uplift lives, impact society, and help shape the nation,” we set out to redefine living, working, and playing as we introduced innovations that aim to reshape the property landscape for years to come.
With this in mind, we set out to ensure that all our initiatives towards innovation are anchored on building a more sustainable tomorrow not only for the property development industry but also for the nation as a whole.
After launching our “iTownships” initiative a couple of years back, we continued to make strides in future-proofing our townships, a development concept that we pioneered back in 1997 when we launched Eastwood City in Libis, Quezon City.
In 2019, we sustained our efforts to incorporate smart technology, digital technology, design innovations, and connectivity capabilities into our developments, while enhancing the green and sustainable features of our properties and enriching them through creative and cultural installations.
During the year, we launched a total of 23 new projects with a total value of P85 billion. Most of these projects are located in key provincial areas, in keeping with our thrust to aggressively expand our property development into strategic locations outside the National Capital Region.
We launched residential projects in Batangas, Cavite, Laguna, Rizal, Pampanga, Baguio City, Boracay, Bacolod City, Cebu and Davao City. We also rolled out projects in McKinley West, Westside City, McKinley Hill, ArcoVia City, and inside the San Lazaro Tourism and Business Park.
We have also launched two new office towers for sale — the One Corporate Place in Maple Grove, Cavite, and the International Corporate Plaza in Iloilo Business Park, Iloilo City.
The year has also been a busy one for our Megaworld Premier Offices. We were able to complete around 192,300 square meters of leasable office space in 2019. This has brought our current inventory of leasable office space to 1.3 million square meters.
We now have over 130 multinational companies as tenant partners, leasing over 70 completed office towers in over 10 key cities nationwide.
By the end of 2020, we aim to have at least 1.4 million square meters of gross leasable space, through the addition of another 110,000 square meters of fresh leasable office space this year. I believe that the value we continuously bring to our office space offerings will allow us to achieve this objective.
The growth of our Megaworld Lifestyle Malls was likewise robust in 2019. We expanded our commercial retail portfolio with the opening of 11 commercial properties across our townships nationwide.
We opened new retail spaces in Iloilo Business Park in Mandurriao, Iloilo City; Alabang West along Daang Hari in Las Piñas City; McKinley Hill and Uptown Bonifacio, both in Taguig City; ArcoVia City in Pasig City; Boracay Newcoast in Boracay Island, Aklan; and Davao Park District in Lanang, Davao City.
Our new commercial properties cover a gross leasable area of around 20,600 square meters, bringing the Megaworld Lifestyle Malls footprint to 453,000 square meters nationwide, spread across 20 lifestyle malls and various commercial centers as of end-2019.
In our continuing effort to transform our developments into models of sustainability, we have begun using solar roof panels for our malls while utilizing an open layout scheme for passive cooling and natural lighting in common areas. In fact, in our new Mactan Newtown Beach Walk mall, around 40 percent of the entire development will be dedicated to green and open spaces.
Our commitment to support the government’s call to elevate the country’s tourism industry has never been more emphasized than in 2019. We opened three new hotels in 2019, with the goal of being able to provide added accommodations to local and international tourists.
These new hotels are the 93-room Hotel Lucky Chinatown in Binondo, the 442-room Belmont Hotel in Boracay, and the 547-room Savoy Hotel in Mactan, Cebu.
Hotel Lucky Chinatown is located near the legendary walled city of Intramuros, the iconic Manila City Hall, and the historic National Museum. The Belmont Hotel Boracay, our second under the Belmont Brand, is located within the sloping area of the estate just beside Savoy Hotel. It overlooks the eastern beach of Boracay Island.
Savoy Hotel Mactan, in turn, is Megaworld’s first hotel development inside our 30-hectare The Mactan Newtown in Lapu-Lapu City. It will cater mostly to business travelers and family vacationers because of its close accessibility to the beach and resorts around Mactan and to the new Mactan- Cebu International Airport.
One of the highlights of the year for us was the opening of our very first cultural museum dedicated to the ‘World’s Oldest Chinatown’ inside the Lucky Chinatown Mall in Binondo, Manila.
The Chinatown Museum features 18 galleries, each focusing on various influences and historical events that have shaped the cultural, social, and economic threads of Binondo. We envision this new cultural landmark, recognized by the National Historical Commission and National Commission for Culture and the Arts, as a community space and heritage project that offers a visual retelling of the rich history of Binondo.
I am also proud to report that, much like in previous years, the Megaworld Group once again garnered several awards in 2019. In fact, we received a record 133 awards from January to December, some 57 of which were from international award-giving bodies.
Of all these citations, we are extremely proud that we were once again named “Best Employer” at the Philippines Best Employer Brand Awards 2019. We were also cited as one of the “Dream Companies to Work For,” not just in the Philippines but across Asia.
These awards effectively complemented our initiatives during one of our busiest years in recent times.
The year 2019 was truly a rich and meaningful one for us. Not only did it mark our 30th year of operations, it was a turning point for our efforts at sustainability.
Nevertheless, we are aware of the headwinds brought about by the COVID-19 pandemic in the country since the early part of 2020. The imposition of community quarantines and travel restrictions has impacted foot traffic and occupancy rates in our malls and hotels. However, this situation also highlighted our strengths.
Our strong financial standing puts us in an exceptionally good position to weather the crisis and take advantage of the opportunities that will arise once recovery begins. The crisis also served to highlight the value of our offerings. For example, our focus on building sustainable townships under the live-work-play concept helped the people living in our communities to cope better with the pandemic as all their needs are immediately accessible. Moreover, the acceleration of the digital economy aligns perfectly with our ongoing thrust towards digitalization.
As we navigate this new reality, we will adjust to the new demands of our diverse market. We will accelerate the implementation of our innovation and digital transformation strategies across all our businesses to align with the current challenges. We will also continue to implement enhanced safety measures in our developments, particularly our malls and office spaces, to ensure that our guests and tenants are safe and protected.
Through all these, we will always ensure that the communities we build will contribute to the creation of a safe, secure, and sustainable tomorrow for everyone.