ALI cuts capex as Q1 profit drops

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May 1, 2026 | 12:00am

MANILA, Philippines — Property giant Ayala Land Inc. (ALI) is slashing its capital expenditures significantly and will review planned launches this year to manage capital and protect balance sheet strength, after first-quarter profit declined by 23 percent amid headwinds in its property development business that weighed on revenues.

ALI president and CEO Anna Ma. Margarita Bautista-Dy said the company has recalibrated its capex for 2026 to around P50 billion, down from its original guidance of P70 billion to P80 billion.

Bautista-Dy said the company would prioritize projects to be turned over this year and next, as well as malls opening in 2026 and 2027.

“For 2026, we are targeting minimal incremental debt with capital expenditures largely funded through internally generated cash,” she said during an analyst briefing yesterday.

Bautista-Dy said the company is carefully reviewing its planned P30-billion in project launches this year, given current conditions.

“As the operating environment becomes clearer, we remain optimistic that we can proceed with the selected horizontal launches by the second half of the year,” she said.

Bautista-Dy said uncertainties around cost and execution drove ALI to cancel Avida’s Katipunan Heights project in Quezon City and pause the Laurean Residences project in Makati.

“These are well-received projects in strong locations, but because construction had not yet begun, we had the ability to act early, minimize disruption, and we will revisit opportunities when cost feasibility and market conditions improve,” she said.

“For Katipunan, we canceled the project. The difference is that Katipunan was launched just a few weeks before the (Middle East) war actually erupted, so we were in a much earlier phase of the selling period. For Laurean, we launched this sometime September last year, and we said we will pause that project, and by pause, we mean that we are putting all selling and development on hold for now,” she said.

Bautista-Dy said ALI would revisit the Laurean project at some point in time once the environment becomes clearer. “We’re thinking of taking a look at it again maybe by the middle of next year,” she said.

Bautista-Dy said there are no cancellations on the company’s other projects and that it would still be a busy year ahead for ALI in property development.

She said ALI continues to deliver on its property development commitments, with approximately 13,000 residential units in 40 projects scheduled for completion this year.

These units are in the final stages of completion and are being turned over in tranches.

“We have P130 billion worth of inventory that we will monetize. This gives us the depth to maintain market leadership while being more selective on new launches. Proceeds will be used prudently to preserve balance sheet strength, fund priority investments and return capital to shareholders when appropriate,” Bautista-Dy said.

“Our strategy for 2026 is clear: to expand our leasing and hospitality platform, maintain stability in property development and preserve the balance sheet strength,” she said.

During the first quarter, ALI saw its net income fall by 23 percent to P5.4 billion from P6.9 billion in the same period in 2025.

Revenues dropped by 14 percent to P37.5 billion from last year’s P43.6 billion.

Property development revenues for the quarter amounted to P20.3 billion, 27 percent lower year-on-year.

Leasing and hospitality revenues, meanwhile, increased by nine percent year-on-year to P12.6 billion, supported by improving occupancy, higher tenant sales and the contribution of newly opened and redeveloped assets across its mall, office and hotel portfolio.

Office leasing revenues remained stable at P3 billion, with occupancy levels continuing to outperform industry benchmarks.