Megaworld—controlled by real estate and liquor billionaire Andrew Tan—is investing 350 billion pesos ($6.3 billion) over the next five years to build townships across the Philippines, betting the country’s economic recovery will continue amid a revival in tourism and consumer spending.
The townships—which will be located across Metro Manila and nearby provinces as well as parts of the central Philippine island of Visayas and the southern island of Mindanao—will have residential, office, shopping mall and hotel components, the company said in a statement.
To tap on the recovery in tourism as well as increasing MICE (meetings, incentives, conventions and exhibitions) activities in the country, Megaworld and its parent company Alliance Global Group are aggressively expanding their hotel footprint as part of the group’s township investment plan.
“With the surge in domestic and international tourism activities, all our hotels have been experiencing high occupancy rates and much-improved average daily room rates,” Kevin L. Tan, CEO of Alliance Global, said in a statement. The group aims to expand its hotel portfolio to 11,000 rooms across 25 properties by 2028 from 7,500 rooms across 19 properties currently.
Revenues of Alliance Group’s tourism-related business increased 84% to a record high of 38.6 billion pesos in 2022, surpassing pre-pandemic levels by 10%. Reflecting its confidence in the sector, the conglomerate agreed to buy out its financially troubled partner Genting Hong Kong in their joint venture company, Travellers International, owner of Newport World Resorts hotel and casino in Manila.
“AGI remains to be the biggest player in the Philippine tourism sector, with the largest array of international and homegrown hotels at varying price points to cater to all types of tourists and visitors,” Tan, whose father Andrew built a multi-billion dollar real estate and spirits business over three decades ago, said. The hotel business contributes over 20% of the group’s revenue.
Alliance Global holds Tan’s interest in Megaworld, one the country’s biggest property developers; Emperador, owner of Spain’s Bodegas Fundador, the world’s No. 1 brandy maker as well as Golden Arches, the Philippine franchisee of McDonald’s. Tan has a net worth of about $2.5 billion, according to Forbes’ real-time data.
Source: Forbes