Leisure developer Boulevard Holdings Inc. (BHI) is investing P2.72 billion to expand the operations of Fridays Boracay Resort and develop a new Fridays Siargao.
In a disclosure to the Philippine Stock Exchange, BHI Chairman, President, and CEO Jose Marcel Panlilio said Fridays Holdings, Inc. (FHI), owner of our Fridays Boracay Resort is spending nearly P2.6 billion in two phases to build a brand new hotel.
He said the new Boracay hotel will triple the number of keys their old hotel had–at 50 rooms.
Phase 1 will cost between P1.6 billion to P1.8 billion or a cost per key of $425,880 without the cost of the land.
BHI and FHI had recently purchased several parcels of land valued at P190,000 per square net of value added tax, in order to secure the resort’s back entrance and additional white sand frontage.
“So, if you add the cost of land at average P100,000 per square meter, the total cost of a 5-star room would be its construction cost of $425,880 plus $210,210 for our existing land, or a total of $636,090 per key,” Panlilio said.
He noted though that, “We are trying to get this down with the involvement of value engineering experts.” Start of construction is April 2024 with a duration of less than two years.
Panlilio said capital structure to pay for the project is all equity with no bank debt, pointing out that, “BHI’s recent transactions with its Cavite properties are sufficient to see us through the costs, which we also try to bring down.”
BHI is among the landowners selling a total of 280 hectares of land in the Puerto Azul-Paniman area in Ternate, Cavite to Bloomberry Resorts Corporation (owner of Solaire) for P7.55 billion
“But prior to the construction we receive possible value engineering suggestions from the latter to lower the cost per key, from said $425,880 to $370,000 to $390,000 construction cost per room,” he said.
Panlilio explained that, “versus our Siargao and Puerto Galera Fridays properties, the Boracay location will take in the bulk of BHI investment monies, since we believe that Boracay will be the prime resort destination in the Philippines over the years.”
BHI earlier bought a “typhoon-wrecked” 5,216 sqm hotel property in Siargao on January 25, 2023 at P19,747 per square meter or P103 million, payable in 1.5 years.
“Most beachfront locations in Siargao are selling for P40,000 to P60,000 per square meter. The location is magnificent—fronting the white sand beaches of Malinao,” Panlilio said noting that most other places in Siargao that are close to surfer activities consist mostly of sharp sanded waterfronts or swampy mangrove choices.
He added that, “The strategy for Siargao is to place a modest sized, 20 to 40 key Fridays property as soon as possible at a low budget cost of P50 million to P120 million.”
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The article was originally published in Manila Bulletin and written by James A. Loyola
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