MEGAWIDE Construction Corp. is willing to create more transport terminals and is open to partner with mall players as it continues to produce high foot traffic considering the coronavirus pandemic.
Although conventional malls suffer less from the health issue, Megawide said its land transport terminals or “landports” are doing vastly better in the current scenario.
Similar to airports—another company that Megawide is involved in—landports are facilities that contribute predominantly to travel requirements, but are leveled through the integration of the structured ticketing structure and industrial and retail establishments.
Megawide currently operates a single land dock, the Paranáque Integrated Terminal Exchange (PITX), which appeals to citizens of Calabarzon heading to and from Metro Manila.
As areas of the world remain under home-stay protocols, nearly 56,000 to 57,000 passengers travel through PITX every day. This is just around 7 percent of the 60,000 passengers per day used by the service to monitor pre-pandemic.
This may be a bright spot for retail and commercial operators who have experienced a 30 to 50 percent decline in mall foot traffic, based on data from the third quarter of property consulting company Colliers International Philippines.
“What we’re creating is a real creation of infrastructure… we will bring traffic and collaborate with other developers including mall operators,” said Edgar B. Saavedra, Megawide Ceo and Chairman, in a virtual conference on Friday.
“The central business of Megawide, particularly with this transport-oriented growth, is that you handle traffic… but you need more projects, such as malls, advertisements, and often residential and office developments, to help transport facilities,” he said.
Megawide indicated that unlike the normal malls whereby bus bays and transport terminals come as assistance for industrial services, Megawide’s approach to business is the other way round.
“Even before the pandemic occurred, we were very positive about the PITX business model, and unlike a typical mall where there are a lot of customers on weekends, PITX is on a normal day,” said Megawide Director Manuel Louie B. Ferrer.
Megawide is actively reviewing a staggered expansion of PITX to P5-billion, which will be partially funded by P4.36 billion raised by the preferred shares last week.
The organization is also looking to develop more landports around the country after nearly half a dozen municipalities (LGUs) have been approached for similar projects in their towns.
“You know, most of our cities in the Philippines do not have proper transportation facilities like terminals. Traffic control is not being well planned. So we’ve been contacted by a few LGUs,” said Mr. Saavedra.
In the nine months ended September, landport activities added P552 million to Megawide’s sales, 167 percent higher than a year earlier when its full operations began in the latter half of 2019.
Megawide derives the majority of its revenue from construction contracts, which dropped by 30% to P7.41 billion in the last nine months.
However, Mr. Saavedra said the order book of the firm is higher than pre-pandemic, as it now stands at P45 billion to P46 billion compared to P44 billion in the first quarter. This does not include the P28-billion Malolos-Clark Railway Project that the firm had already packed in September.
“One comparative advantage of Megawide, apart from being especially integrated, is that we already have in-house capabilities—we can do utilities, we can do vertical work, we can do horizontal water treatment plants. We may still follow all these technical ventures,” said Jez G. Dela Cruz, Megawide Head of Corporate Finance.