Megawide targets 100,000 housing units under Philippines' 4PH program

Megawide Construction Corp. is betting on affordable and socialized housing under the Philippine government's Pambansang Pabahay para sa Pilipino Program (4PH) to drive its next growth phase. Chairman Edgar B. Saavedra said the company targets delivering 5,000 to 7,000 units in the coming year, scal

MEGAWIDE Construction Corp. is banking on its foray into affordable and socialized housing under the Philippine government's expanded Pambansang Pabahay para sa Pilipino Program (4PH) to drive its next phase of growth, Chairman and Chief Executive Officer Edgar B. Saavedra said.

Mr Saavedra said the company sees significant opportunities in these segments as it helps address the Philippines' persistent housing backlog. "Because of the demand, the opportunity is huge, hopefully, this can be one transformation in the next two to three years. We'll see," he said in an episode of BusinessWorld One-on-One.

The listed infrastructure company's strategic shift capitalises on a market imbalance where mid- to high-end housing sales have slowed while demand for affordable homes continues to outstrip supply. "We all know that there's a mismatch in the current real estate market. We know that there is an oversupply in the P5 million and up condominium houses. But in the P2 million and P3 million (units) and below, there's really a shortage," Mr Saavedra added.

Megawide last year partnered with the Home Development Mutual Fund (Pag-IBIG Fund) for the 4PH program, with Pag-IBIG investing P10 billion in Megawide to support development of over 7,000 housing units. The company is targeting delivery of 5,000 to 7,000 units in the coming year, before scaling capacity to 10,000 to 20,000 units annually. "We committed 100,000 units. But I told the President (Ferdinand R. Marcos, Jr), we may not be able to deliver the whole 100,000 in three years, but definitely it will be launched," Mr Saavedra said.

Megawide is prioritising housing sites in urban fringe locations such as Taytay in Rizal, Cavite, and San Jose del Monte, Bulacan. "The problem before in socialized housing... (The location is) too far. The residents need to travel, like two hours, three hours (to get to work). So, this program is really to address the backlog in Metro Manila, where people can just reside in the fringes," he said.

Mr Saavedra likened Megawide's pivot to affordable housing to its foray into public private partnerships (PPP) more than a decade ago, which included delivering 10,000 classrooms in 27 provinces for the Education department, the Mactan-Cebu Airport, the Parañaque Integrated Terminal Exchange, and Clark airport construction. He said the Philippines needs to continue investing in infrastructure, but noted investor interest in PPP projects is being dampened by corruption, long wait times, and court challenges. "(Appetite for PPPs) is disappearing. I asked the foreign players and the investors have the same comment that if (the other bidders) lose, they will file a TRO (temporary restraining order), they will be questioned, and it will take a long time."