Ayala Corp. Keeps Buying Ayala Land Near Multi-Year Lows—But One Number Will Show Whether the Comeback Is Real

MANILA, Philippines — Ayala Land Inc. is going through one of its roughest market stretches in years, but some of the people with the most at stake are behaving as if the downturn may eventually prove temporary.

Parent company Ayala Corp. has continued accumulating shares of its listed property arm, even as Ayala Land’s stock trades near levels not seen in years and the residential property market struggles with weaker demand, higher financing costs and geopolitical uncertainty.

Meanwhile, some buyers of one of Ayala Land’s most closely watched luxury projects have chosen to wait rather than demand their money back after the development was placed on hold.

Those decisions do not prove that Ayala Land has reached the bottom.

But together with a partial rebound in capital spending, they are creating an increasingly important question for investors:

Is one of the Philippines’ biggest property developers quietly preparing for the next cycle while much of the market is still focused on the current downturn?

Ayala Corp. Is Putting Real Money Behind Its Conviction

This is not merely management expressing confidence in interviews.

Ayala Corp. disclosed in July that it had allocated ₱5 billion for additional purchases of Ayala Land common shares, including ₱2 billion from its approved investment capital expenditure budget.

At the time of that disclosure, Ayala Corp. said it had already used about ₱599.5 million of the allocation.

The buying began earlier.

On June 16, Ayala Corp. disclosed that it had purchased 35 million ALI shares at an average price of ₱13.07 each, an investment of roughly ₱457 million in a single transaction.

Subsequent purchases continued as the conglomerate increased its exposure to the property company.

InsiderPH reported that Ayala Corp. had effectively shifted part of its share-buyback strategy toward ALI, signaling that management saw greater potential value in buying its property subsidiary at depressed prices.

That matters because Ayala Corp. has access to information about its subsidiary's strategy, balance sheet and long-term pipeline that ordinary investors carefully watch through public disclosures.

It does not, however, guarantee that the stock will rise.

Parent-company buying is a signal of conviction—not proof that the market has mispriced the shares.

ALI Shares Have Been Punished

The confidence comes against a bruising backdrop.

In May, Ayala Land shares fell to ₱14.74, a level last seen around 2011, after losing more than a third of their value since the beginning of the year at that point.

By September 8, InsiderPH reported that ALI was trading at roughly ₱15 a share.

The market pressure intensified after index provider MSCI announced that Ayala Land would be removed from the MSCI Philippines Standard Index and shifted to its Philippine Small Cap Index after August 31.

Such a change can force funds that mechanically track the benchmark to adjust their holdings, potentially generating additional selling pressure even when nothing has changed overnight in the underlying company's buildings, land bank or cash-generating assets.

The downgrade followed months of concern over property-sector fundamentals.

First Metro Securities had earlier cut ALI to “hold” from “buy” and reduced its target price to ₱15.50 from ₱28, citing a tougher housing environment and other financial risks.

That is the uncomfortable part of the Ayala Land story:

The company may look historically cheap, but the reasons for that discount are real.

Earnings Show Why Investors Remain Cautious

Ayala Land's first-half numbers illustrate the problem.

Net income declined 19 percent year on year to ₱11.5 billion, while consolidated revenues fell to about ₱75 billion.

Property development remained the main weakness.

But there was one encouraging sequential indicator: second-quarter net income improved 13 percent from the first quarter to ₱6.1 billion, suggesting that conditions were at least stabilizing after a particularly difficult start to 2026.

Recurring-income businesses are also providing an increasingly important cushion.

Leasing and hospitality revenues grew despite weakness in residential development, reinforcing Ayala Land's strategy of becoming less dependent on condominium and housing sales.

That strategy predates the current downturn.

Earlier this year, CEO Anna Ma. Margarita Bautista-Dy said leasing was expected to become a major growth driver, with the company working toward a more balanced contribution between recurring-income assets and traditional property development.

That diversification could become crucial if residential demand takes longer to recover.

From ₱80 Billion to ₱50 Billion—Then Back to ₱60 Billion

Perhaps the clearest illustration of Ayala Land's changing view of the market is its 2026 capital expenditure budget.

The company originally planned to spend roughly ₱70 billion to ₱80 billion this year.

After its difficult first quarter and a deterioration in the external environment, Ayala Land cut that guidance sharply to around ₱50 billion, prioritizing cash flow and balance-sheet protection.

Then came another change.

After conditions stabilized in the second quarter, management increased its planned spending to approximately ₱60 billion.

Ayala Land formally confirmed that revised amount in a Philippine Stock Exchange disclosure on August 12.

The company had already spent ₱39.5 billion in the first six months of 2026.

That is still below the original ₱70-billion-to-₱80-billion ambition.

So this is not yet a return to full-speed expansion.

It is better understood as a cautious step back toward growth after an emergency pullback.

And that distinction matters.

Laurean Residences Offers Another Test of Confidence

Then there is Laurean Residences, Ayala Land's high-end Makati condominium project.

The roughly ₱28-billion luxury development had already secured more than ₱10 billion in bookings before Ayala Land made the unusual decision earlier this year to pause sales and development as rising costs and a deteriorating market changed the project's economics.

Affected buyers were given options.

They could transfer to another Ayala Land development, seek a refund with interest, or remain with Laurean and wait.

According to Bautista-Dy, about half elected to stay.

That is significant because Ayala Land has said it may not revisit the project's future until 2027, meaning those buyers are choosing patience without an immediate restart date.

It is a meaningful indication of customer confidence in the Ayala Land brand.

But it should not be mistaken for evidence that the entire luxury property market has recovered.

The decision to pause Laurean in the first place remains one of the clearest examples of how severely market conditions changed.

Why Ayala Land Is Betting More Heavily on Recurring Income

The company's response goes beyond waiting for condominium demand to return.

Ayala Land is pushing deeper into malls, offices, hotels and other assets that generate recurring rental or operating income.

Earlier this year, management said leasing and hospitality were becoming increasingly important to earnings and could eventually reach a more balanced contribution with property development sooner than previously expected.

The company is also monetizing mature assets through AREIT.

In August, Ayala Land's board approved the infusion of commercial properties valued at roughly ₱17.33 billion into AREIT through a property-for-share swap, along with a separate approximately ₱2.62-billion cash transaction involving Fairmont Raffles Makati condominium units.

The strategy can free capital trapped in completed properties, allowing Ayala Land to recycle funds into new developments while maintaining economic exposure through its REIT platform.

In a difficult property cycle, that capital recycling becomes particularly valuable.

So Has Ayala Land Already Hit Bottom?

There is growing evidence that the company's operating deterioration may be slowing.

Second-quarter profit improved sequentially.

Inventory has come down.

Capital spending has been raised from the emergency ₱50-billion plan.

Its parent company is buying shares.

And many buyers in a delayed luxury project are staying.

Those are genuine positive signals.

But several reasons for caution remain.

First-half profit is still down sharply from last year.

Residential property development remains weak.

The Philippine property market is still dealing with affordability issues and cautious buyers.

And the MSCI removal demonstrates just how far market sentiment toward a company once regarded as one of the Philippine Stock Exchange's most dependable blue chips has deteriorated.

That makes the next few quarters much more important than any single share-purchase disclosure.

For Ayala Land, the real test is whether confidence from management, its parent company and its customers eventually translates into higher reservations, stronger cash flow and sustained earnings growth.

Until then, the long-term thesis remains exactly that:

a thesis waiting to be proven.

And that may be why Ayala Land's current situation is so unusual.

The stock market is pricing in substantial difficulty.

Yet the people closest to the company are behaving as if today's weakness could eventually become tomorrow's opportunity.

Whether they are early—or wrong—is the multibillion-peso question.

WWC ONE MEDIA M.J.E