The return of Bobby Ongpin
This summer, it is timely to talk about resorts and tourist destinations. In the business of developing resorts, few can perhaps hold a candle to Roberto “Bobby” Ongpin (RVO), the former trade and industry minister (1979-1986) of President Marcos.
After People Power of 1986, Bobby went on his own, first in Hong Kong and later, here in Manila where he readily put up or acquired control of five major companies—PhilWeb, ISM Communications Corp., Atok Big Wedge, Alphaland Corp., and PBCOM.
Ongpin is the original developer of Tagaytay Highlands, the members-only resort and golf course. Highlands is his enduring monument as a developer. But he had bigger things in mind. With his holding company Alphaland Corp., Bobby went on to develop the 500-hectare Balesin Island, 29 nautical miles off the eastern coast of Luzon in the Pacific Ocean and 20 minutes by jet from Manila, into an exclusive members-only resort.
At Balesin, he built seven themed villages on 40 hectares in the property leaving the 92 percent as virgin forest, including 40,000 coconut trees. The villages are patterned after famous world resorts – Bali, Costa del Sol, Mykonos, Phuket, St Tropez, and Toscana plus the native Balesin Village, which has the best portion of a 7-km beach, double the length of Boracay beach. RVO built 300 villas in the villages plus 14 suites in the Balesin Royal Villa which is designed like a Thai palace.
RVO spent P7 billion to develop Balesin. It is now one of the most sought-after private members-only resorts in the region. Memberships sell for P2.2 million for seven nights free a year (Gold), P4 million for 14 nights (Diamond), and P6 million for 28 nights (Corporate). The price doubled in three years.
A companion project to Balesin Island is another resort but on another island, Patnanungan, 23 nautical miles from Balesin. Both islands are part of Quezon province. In Patnanungan, Ongpin will spend P5 billion to build an 18-hole golf course, 500 beachfront and golf course homes, and a 400-room hotel for local and foreign tourists, plus a 2-km runway to take in jets the size of a Boeing 777 or Airbus 320 so that tourists from every world capital can fly in. Called Balesin Gateway, the project will also serve as an international airport for Balesin Island, which has a shorter runway of 1.5 kms.
Another large project (P5 billion) is the Alphaland Baguio Mountain Lodges on a 78-ha chunk of mountain in Benguet, ten minutes from Baguio city center. Here, 300 log cabin houses will be built ranging in size from 3-1/2 to 5-1/2 bedrooms and rimmed by lush pine forest. In the first year of development, which is this year, 50 mountain lodges will available, but 96 have already made reservation to buy, stunning, considering that the homes go for as high as P50 million each.
At this writing, Bobby is in Europe to procure logs for his Baguio log cabins or lodges. Harvard-educated Ongpin is back with a vengeance after two recent developments that resulted in a strategic shift in his business vision and model. His Alphaland “divorced” from Ashmore of London three years ago. Last year, he was unfairly singled out by President Duterte as a gambling oligarch whose money flows in as fast as that of a taxi meter, while ensconced in private jets and mansions, and thus was one he wanted to destroy.
This 2017, Forbes ranked Ongpin as the 13th richest Filipino and among the world’s 2,000 richest dollar billionaires, with wealth of $1.1 billion. My BizNewsAsia estimates his wealth at $1.4 billion.
Ongpin, who is actually related to Duterte, got the President’s goat thinking he was into the gambling business. Actually, the biggest gambling company, Pagcor, is owned by the government. As it turns out Ongpin’s PhilWeb was merely a software provider for e-Gaming outlets licensed by the state-owned Pagcor. Ongpin, who is distantly related to Duterte, sold his majority control in PhilWeb at a loss of a whopping P18 billion (then equivalent to $379 million) and simply moved on.
In 2016, Ongpin’s Alphaland posted record profits, P7.7 billion, up seven percent from P7.2 billion in 2015. Alphaland’s equity P52 billion is nearly 10 times its debts, a reverse of the norm for companies of its size. This year, he secured a landmark P5.5-billion loan to help finance two major projects—the Alphaland Baguio Lodges, and the new Balesin Gateway on Patnanungan Island.
Alphaland Corp. is on a roll. It is undertaking even larger and more ambitious projects with Ongpin, 80, providing the vision and management execution. It has just secured a P5.5-billion loan from BDO Unibank.
“This [loan] is the most significant development for Alphaland,” gushed Ongpin. “Aside from the obvious improvement in the financial position of Alphaland, this is a significant vote of confidence from the country’s largest bank. It tells an important story.” The loan is for seven years with a one-year grace and has lower than average interest. Alphaland will repay existing bank debts of P4 billion. The balance of P1.5 billion will help fund new major projects such as the Balesin Gateway (Patnanungan Island) and the Alphaland Baguio Mountain Lodges.
Alphaland has also completed two other crown jewels—the Makati Place and the Aegle Wellness Center of which there are two—a compact one at City Club Alphaland Makati and a much bigger one at Balesin. Makati Place is home to another members-only enterprise the City Club, which is an exclusive urban sport and leisure membership club. It has seven restaurants and houses the Aegle Wellness Center which is open to walk-in customers. The building also houses 494 units of the Alphaland Residences. The building is unique in Makati for having parking good for 1,000 cars.