MANILA, Philippines - Property developer 8990 Holdings may not be a household name in Luzon, but it has managed to attract investments from Malaysia's state investor Khazanah Nasional Bhd and international investment company TPG Capital.
In an interview on ANC's News Now, 8990 Holdings chairman Mariano Martinez said it was the company's business model for low-cost housing that appealed to Khazanah and TPG. 8990 Holdings is best known for the Deca Homes brand in the Visayas and Mindanao.
"Very early on we started talking with them. They wanted to invest in the Philippines, but it's just that they have not been able to locate a particular company that they wanted to invest in. But our business model of low-cost housing appealed to them," he said.
Khazanah and TPG each bought a roughly 9 percent stake in 8990 Holdings. It was the first Philippine investment for both companies.
"They have holdings in Malaysia and Indonesia, as well. They looked at what we are doing in low-cost housing and they thought maybe this can be replicated in their countries as well, although there is no particular talk of when that could be done. We began by saying, why don't you invest in us first and then you see what we do. If you're happy, then we can probably assist," Martinez added.
The 8990 official said there is a possibility its low-cost housing model can be replicated in other Asian countries, but there is no time table.
"These investors are long-term investors. They are here to stay with us and support us in whatever undertaking we are geared to do... There is no timetable. We're type of housing owners that want to first service the Philippines. As you know we have a big housing backlog... And we want to address that," Martinez said.
8990 Holdings boasts of a 40 percent margin for its residential projects. Martinez attributed this to three factors: 8990's construction technology, innovative selling method and strong credit and collection team.
"We have a technology that we use that allows us to build units in as fast as 8 days in our horizontal units... We also do vertical buildings. We do sell mid-rise units in Mandaue, Cebu and we finish a building in 45 days," Martinez said.
The company sells units to buyers with just a two percent downpayment requirement. However, it also has a strong collection team that ensures the buyers can make their payments.
8990 Holdings is also gearing for more growth this year.
"We expect very good results this year... have have 8 on-going projects, we should be able to derive 24,000 housing units from that... We only did almost 7,000 units in 2013 and we are cleared to do 8,800 units this year," Martinez said.