Philippine Property Market: Ayala Land Boosts Capex Despite Earnings Dip, Rate Hike Looms
Ayala Land raises spending plans as first-half profit slides and UOB flags a possible BSP hike to 5%
Written by PropVela Editorial TeamPublished 2 min read
Today's roundup looks at Ayala Land's shifting capital spending plans against a backdrop of softer earnings, plus a fresh interest rate call that could shape mortgage affordability in the months ahead.
ALI lifts capex to about P60 billion
Ayala Land, Inc. has raised its 2026 capital expenditure target to roughly P60 billion, up from an earlier P50-billion plan that had itself been trimmed from a more ambitious P70-billion to P80-billion budget after a weak first quarter. Company president Anna Ma. Margarita Bautista-Dy said the upward revision reflects confidence in select high-conviction projects, including Ayala Gatewalk in Cebu, whose office component is slated to open this December. She cautioned, though, that ongoing geopolitical conflict and slower second-quarter GDP growth mean the business climate remains difficult. According to BusinessWorld, the increase signals selective optimism even as broader headwinds persist.
Ayala Land 6-month earnings down 19%
Ayala Land's first-half net income dropped nearly 19 percent year-on-year to P11.5 billion, down from P14.2 billion, as the property developer contended with a tougher operating environment. Still, momentum picked up in the second quarter, with net income climbing 13 percent from the prior quarter to P6.1 billion. Residential inventory also tightened to 15 months from 18 months, suggesting brisker sales, while leasing and hospitality revenue rose 9 percent to P25.2 billion. According to the Philippine Daily Inquirer, the improved second-quarter showing offers a partial silver lining to an otherwise soft first half.
UOB sees BSP key interest rate hitting 5% at August meeting
United Overseas Bank expects the Bangko Sentral ng Pilipinas to hike its benchmark rate by 25 basis points to 5 percent at its August 27 meeting, framing it as a final adjustment aimed at taming persistent inflation and shoring up a weakening peso. UOB projects the central bank will then hold rates steady through the second quarter of 2027. The call comes as GDP growth slowed to a post-pandemic low of 2.3 percent in the second quarter, raising concerns that further tightening could dampen domestic demand—and, by extension, mortgage rates and housing affordability. According to Manila Bulletin, the forecast underscores a delicate balancing act between controlling inflation and sustaining growth.