El Pueblo Condormitel Project – CSR Report FINAL DRAFT / Oct 16, 2008 Prepared by Franchesca Casauay for Phoenix Sun Intl. Corp.Phoenix Sun International Corporation (PSIC) Corporate Responsibility Report on the El Pueblo Condormitel Project
El Pueblo Condormitel Project – CSR Report FINAL DRAFT / Oct 16, 2008 Prepared by Franchesca Casauay for Phoenix Sun Intl. Corp. Mission, Vision, and Values Man’s three most basic needs are food, clothing, and shelter. While there are charities, soupkitchens, and donation groups that can provide the first two for people without the adequate means toacquire them, such as the majority of the urban workforce, there are few private institutions orindividuals that aim to provide permanent housing for this marginal sector. Government resettlementareas in the Philippines are usually cramped, inadequately structured and ineffectively designed.Although they do help alleviate the housing problem, they fail to provide its residents with a healthyenvironment and improved quality of life. PSIC recognizes that the people working in the city—the urban workforce—plays a veryimportant role in society and actually serves as the backbone of our economy. Thus, PSIC is on amission to improve the lives of the people who play this very crucial role through the improvement oftheir current housing situation. The company does this by building affordable, accessible and dignifiedliving spaces specifically targeting the marginal market, beginning with its main and current endeavor,the El Pueblo Condormitel Project, while envisioning a business that is not only profitable, but one thatalso significantly contributes to the upliftment of people’s individual lives, leading to a positive impacton the overall society. And every step of the way, PSIC vows to always uphold and never lose sight of itsmajor values: Respect for Nature, Lifestyle Integration and Understanding of Human Needs, whichwhen put together results in Quality of Life. PSIC’s housing projects are conceptualized around these values. With Grace Eleazar at thehelm, the people behind the company always make sure that the living spaces they build and designalways possess the ability to raise its residents’ inner consciousness and awareness for health, wealth,respect and love for nature. Positive emotions and experiences, when experienced by individuals, canlead to a more creative, productive, and happy way of life, setting them on the path to being excellentcitizens that are the building blocks of a better society. With this, hopefully, the PSIC Philippineexperience can serve as a base model that can be replicated all over Asia and then the world. Corporate Social Responsibility in Action GIVING BACK TO THE COMMUNITY: Addressing the Housing Problem through El Pueblo Condormitel Project combined with the LIKAS™ Design ConceptPSIC puts Corporate Social Responsibility to practice, first of all, by giving back to the urbanworkforce community, with the stakeholders needs in mind right from the conceptualization of theLIKAS™ design concept up to the building and payment schemes of the El Pueblo Condormitel. A big part of the housing problem was due to the fact that other developers from the privatesector and the government were building low-cost residences in locations outside Metro Manila when,based on PSIC President and CEO Grace Eleazars personal experience with her employees, most of theneed was clearly in the heart of the business district where workers offices are situated. Since urban realestate is very expensive, the only solution PSIC could think of was to follow the trend of the urbanhousing designs of Japan and Singapore by developing its own unique lifestyle integration concept.Because for the common employees to be able to sufficiently afford these types of units, PSIC has tobuild houses smaller than what was legally permitted by current Philippine Law. And lifestyleintegration should be mandatory if one hopes to unlock the full potential of his/her small living space. The PSIC team studied the market (common employees) and how much they usually spent oncommute fare to and fro their place of work (approx. P2,500/work month or P100/day), and decided tooffer units that were accessible, affordable, and dignified while priced at the same P2,500 cost1. Thiswould enable urban workers to save time and energy and spend more time for rest and quality time withtheir family, instead of wasting hours on the long commute. After much drafting and designing, PSIC1 This is currently the price of El Pueblos most affordable amortized unit
El Pueblo Condormitel Project – CSR Report FINAL DRAFT / Oct 16, 2008 Prepared by Franchesca Casauay for Phoenix Sun Intl. Corp.concluded that for the said price, an 8.5 by 8.5 square meter-unit, if properly designed, would beadequate. Using her background in real estate and holistic living, Eleazar developed the Condormitelbrand to connote PSICs small but fully-furnished units which will go beyond just serving as simpleliving spaces; they will also have lifestyle integration, something that other developers have failed toincorporate in their structures. Calling the pilot project El Pueblo One2, all current and subsequent El PuebloCondormitel units are built using the innovative Lifestyle Integration for Well-Kept andAffordable Shelter (LIKAS)™ design concept, which means they come fully-furnished withamenities that would encourage its would-be tenants to behave in a dignified, disciplined, andhealthier way as individuals and as a community. At a glance, LIKAS involves the following features andservices: All units come fully-equipped with furniture and appliances. Residents can move in immediately Free piano and cultural lessons to introduce residents to the refinements of life Commercial spaces which are free of rent so residents may sell their wares for additional income Provision of shuttle bus which residents may use to bring them to their transport areas (in the works) Recreational facilities such as a badminton and basketball court, playground for kids, a pool (in the works) and big lobbies to accommodate residents visitors and guests Audio-visual presentation on house rules and regulations before residents move in Edible landscaping which has root crops for food, and medicinal herbs that residents may use to cure simple ailments Piped-in music in the promenade to soothe the senses and elevate consciousness Health seminars on nutritional healing and proper nutrition for health maintenance Academic scholarships and grants Fruits from the tress in the vicinity are harvested and distributed regularly, free of charge Design of units hone in residents living habits, such as de signated storage places for shoes, luggage, cleaning materials, and wet & dry grabage, while also addressing issue of security Subsidized association dues for 5 yearsAnd at more length, these are what the El Pueblo Condormitels, combined with LIKAS, achieve: Dignified and comfortable living spaces All units, even those as small as 8.5 sq.m. are ergonomically designed to maximize space. Theycome fully-equipped with amenities only commonly available in high-end residential developments,such as beds, electric stoves, TV sets, fans, cabinets, tables and chairs, kitchen sink, a toilet & bath,curtains, bed covers and lampshades. Large storage spaces are built in to encourage a more organizedhome and a waste segregation disposal system is in place to promote a more sanitary space. For thecommunity, a multi-purpose hall is available wherein residents can engage in sports and recreation, anda common commercial space can be rented at no cost where tenants can sell homemade products andcrafts for additional income. Edible gardens, which are tended and managed by El Pueblos crew, arealso provided, whose plants and vegetables may be harvested for eating or as cures for commonailments. Because all units already come fully furnished with appliances and furniture, all the residentsneed to do is bring their clothes and theyre ready to move in. But before moving in, all would-betenants are required to attend an orientation where the community’s Dos and Don’ts are explained anddiscussed, to ensure the observance of proper lifestyle practices that promote harmony within thecommunity. Affordability of units Housing in the traditional sense has always been considered a luxury, especially in the2 El Pubelo One is located at Kings Point Subdvision, Novaliches, Quezon City. El Pueblo Manila, construction currently ongoing, is located at Anonas St., Sta Mesa, Manila. Both locations are within close proximity to public transport, schools, and commercial centers. Condormitel and LIKAS are IPO-registered trademarks of PSIC.
El Pueblo Condormitel Project – CSR Report FINAL DRAFT / Oct 16, 2008 Prepared by Franchesca Casauay for Phoenix Sun Intl. Corp.Philippines. With the continued rise in population, land gets increasingly scarcer and thus moreexpensive. The LIKAS™ housing concept changes this paradigm, offering El Pueblo Condormitel unitsas low as P2,500 per month amortization for a joint ownership of unit for two occupants. And since allLIKAS™ housing projects are situated in Metro Manila, more savings can be incurred from reducedtransportation expenses. Carefully planned location of units Aside from increased savings resulting from lesser transportation costs, having a home you caneasily access after work (and vice versa) brings immense psychosocial benefits. Shorter travel time toand from the workplace adds to time spent with family and loved ones--creating a more harmoniousfamily life, lessens both physical and psychological stress caused by long travel hours, and encouragesbetter productivity at work because of adequate rest. Opportunities for cultural enhancement and subsidized education The LIKAS™ concept also involves community activities to enhance the art and culturalconsciousness of its residents. Painting, violin, piano and ballet lessons are given, free of charge, toanyone who might be interested in taking them. The Los Pueblos Foundation, El Pueblo’s charitable arm, has also been recently put into place togive academic scholarships to deserving students based not only on scholastic records—the children ofthe El Pueblo community can also avail of the scholarship program based on the cleanliness andmaintenance of their units as a further incentive to residents to keep a well-kept house and organizedlifestyle. Access to health education and services Aside from a wellness clinic which is readily available to residents on-site, seminars on how tomaintain a healthy lifestyle are regularly given to residents and their families. Services of doctors andpractitioners of alternative medicine are also offered to give residents more options towards healthyliving. Though this clinic has yet been to fully operational, the nutritional healing seminars are regularlybeing given to El Pueblo residents. People Empowerment thru Livelihood Programs for Relocated Families In July 2007, informal settlers residing beside the railroad tracks in Sta. Mesa, Pandacan andSampaloc had to be relocated due to the Southrail Rehabilitation Program of the Philippine NationalRailways (PNR). Since El Pueblo Manila’s construction site was in Sta. Mesa, PSIC also indirectlybenefitted from this move, so they decided to offer livelihood programs for the relocated families in oneof the resettlement areas in Trece Martires, Cavite. Following the classic adage of not just giving themfish but teaching them how to fish, a seminar on organic chicken raising was given to the community inaddition to the 3000 chicks that were distributed to 300 families (10 chicks per household), completewith poultry feeds enough to last for 3 months. Furthermore, to ensure a stable and sustainable livelihood for the whole community, 2 chickens perfamily were required to be given back after they were raised to be pooled in a common chicken-raisingfarm. In effect, the farm’s 600 chickens could produce around Php800,000.00 worth of eggs per yearwhen sold to groceries and markets. significantly helping the community become self-sufficient. ~PSIC does not only incorporate CSR in the building and designing of its Condomitels, but also extendsthis to its peripheries: in the way it treats the employees that help market, run, and maintain the ElPueblo Condormitels, and its high regard for the the environment in all aspects of the El Puebloconstruction. EMPLOYEE & SUPPLIER RELATIONS Housing Incentives Although El Pueblo Condormitel units can be purchased by the general public, regularemployees of PSIC may also avail of the units, either through in-house financing or as incentive for jobperformance and quality of service. To date, three (3) outstanding employees have been awarded their
El Pueblo Condormitel Project – CSR Report FINAL DRAFT / Oct 16, 2008 Prepared by Franchesca Casauay for Phoenix Sun Intl. Corp.very own El Pueblo Condormitel units for free. Hassle-free Salary Loan Regular employees [those who have been in the company for a minimum of six (6) months andup] with guarantors may automatically borrow 50% of their monthly salary with absolutely no collateralneeded, and with flexible payment terms that are simply deducted from subsequent paychecks for easierremuneration. Physical Fitness Programs Free aerobics classes for the whole PSIC staff are held in the office during weekends to encourage employees to enhance and improve their physical conditions and offset the sedentary lifestyle that usually comes with office work. Value Orientation Seminar PSIC provides its employees with free value orientation courses held twice a month. Thesecourses are meant to motivate them and keep them driven to excel. After all, PSIC believes that ifbusiness partners are happy and satisfied, then the corporation as a whole also benefits. Shelter Provisions for Contractors and Subcontractors For PSIC projects which require the services of contractors and subcontractors such as ElPueblo, their employees are provided with sturdily built and well-maintained transient houses near thesite where they can spend their lodging during the project’s duration, helping them save on transportcosts and travel time as well. Local Hiring of Suppliers Materials for major parts of the El Pueblo Project are sourced from local craftsmen instead offoreign suppliers. Furniture in the El Pueblo Condormitels is provided by small furniture makers fromthe province to give local business a boost and to provide buyers with authentic Filipino-made furniturethat’s both sturdy and artistic. ENVIRONMENT Careful Survey of Topography Before Building Before starting the El Pueblo Projects or any project in that case, Ms. Eleazar personally makessure to get a topographical survey of the trees on-site. PSIC avoids the cutting down of trees as much aspossible. When there is no other way around it, the PSIC team carefully selects which ones to cut, optingto cut down saplings and small trees instead of uprooting the bigger and older ones. Tree-Planting Missions To replenish the trees that were cut down, Eleazar involves all PSIC company staff in tree-planting missions, the most recent one as part of the La Mesa Dam Rehabilitation Project in QuezonCity, January 2008. The company was the first to adopt a hectare at the La Mesa Dam for tree-planting. Waste Segregation System An instructional video is shown to El Pueblo residents to teach them how to properly segregatetheir waste before disposing them. Non-compliance warrants a notice and a fine to discourage violators.This waste segregation system is also practiced by PSIC employees in the office. The Aftermath Aside from the personal and professional fulfillment that comes from developing an alreadyprofitable product into something that actually touches human lives and offers the marginal marketsomething which clearly addresses their needs, PSIC’s El Pueblo Project has also triggered somerevolutionary changes in housing trends and policies.
El Pueblo Condormitel Project – CSR Report FINAL DRAFT / Oct 16, 2008 Prepared by Franchesca Casauay for Phoenix Sun Intl. Corp.Setting the Trend for Affordable Housing Since PSIC completed its El Pueblo Condormitel units in 2002, the real estate landscape haschanged. Other developers have followed suit and started building smaller and less expensive unitsgeared toward lower bracket markets. As a result, more low-income families have had the chance toacquire more affordable homes. However, El Pueblo’ competitive advantage lies in its integratedLIKAS™ design concept, which doesn’t end at just selling a physical livable structure , but also comespackaged with better and healthier lifestyle practices. Also, since PSIC started this new trend towards the development of low-cost housing, there hasbeen surplus of developers which are currently doing the same, and at present, building affordablehouses. And this may be one of the reasons why the Philippine real estate landscape hasnt beendevastated by the current US financial crisis. Real estate developers activities directly affect more than60 industries (e.g cement, manpower, contractors, suppliers. etc.), and because our real estate industryis very much alive, people are being hired and business is thriving. Likewise, because the product beingmarketed and sold is cheaper, it is not as difficult to attract the market and make a sale.Revolutionizing Housing Regulations Prior to El Pueblo One’s inception, the minimum approved land size for building was pegged at18 sq.m. by the Housing and Land Use Regulatory Board (HLURB) of the Philippines. But whengovernment and HLURB officials visited El Pueblo and got to see PSIC’s pioneering 8.5 x 8.5 sq.m fullyfurnished units for themselves, they immediately saw its market potential and social value. PSIC’s smallunits were approved, as long as the company continues to comply with zoning rules and othermandatory regulations. To date, El Pueblo has been given exclusive permission to build housing units assmall as 8.5 sq.m since the Philippine government considers it a pilot project. Still, the minimumapproved land size has now been moved to 13 sq.m., now allowing builders to go smaller if they have to,thanks to El Pueblos ground-breaking move.Contributing to the Amendment of the Limit on Real Estate Loans of Universal Banks/Commercial Banks As a Small to Medium Sized Enterprise, PSIC has had difficulty acquiring developmental loansfor expansion of real estate projects. Most banks usually give loans based on a company’s portfolio anddoes not give loans that exceed 20% of it, and only if its total net worth reaches the Php 100-150 millionmark. Ideally, banks should give loans based on a project’s social relevance, bankability and feasibilityand not on the size of the company. As a medium-sized developer, PSIC simply cannot qualify, andwouldn’t have been able to borrow money for the El Pueblo Project if Allied Bank Philippines andUnited Coconut Planters Bank did not take a risk on them. This matter was brought to the attention ofthe Bangko Sentral ng Pilipinas (BSP)3 governor and CIRCULAR NO. 6004 which amends theprevious regulation was released on February 2008. On the Horizon With the El Pueblo One in Quezon City almost completed, and the El Pueblo Manilaconstruction currently ongoing, PSIC will continue replicating its breakthrough LIKAS™ concept andincorporating it in future projects. Complete details are not yet available during press time, but a projectis in the offing, which aims to build a resettlement village in Alabang utilizing the LIKAS™ concept andstate-of-the-art and environmentally-friendly building materials at an affordable price. The main goal isto provide the backdrop for the flourishing of yet another environmentally-aware self-sustainingcommunity that observes lifestyle-integrated best practices. ~ In this day and age where real estate prices are rocketing, especially those within the vicinity ofbusiness districts, it seems that the average urban worker has lesser and lesser chances to acquire ahome that is truly his own. Especially one that is able to house him in comfort while providingconvenience of location and solutions to his lifestyle needs. PSICs El Pueblo Project is prepared to3 Central Bank of the Philippines4 To view the circular, visit BSP’s website: http://www.bsp.gov.ph/regulations/regulations.asp?id=2001
El Pueblo Condormitel Project – CSR Report FINAL DRAFT / Oct 16, 2008 Prepared by Franchesca Casauay for Phoenix Sun Intl. Corp.change this paradigm with its LIKAS design concept which makes the best of small-sized living spacesby providing affordable and fully-furnished units complete with lifestyle-integrated amenities for thetenant and the whole community. With these in place, El Pueblo with LIKAS promotes the developmentof self-discipline, environmental responsibility, sociability, livelihood opportunities, health awareness,and respect for facilities and the whole community. Providing the marginal sector with dignified anddecent living spaces help them live dignified and decent lives—nourish their body and spirit and raisetheir consciousness and they will start taking care of themselves, becoming more creative, productive,and better citizens that pave the way to a better society. Appendix El Pueblo Condormitel – Current Project Status EL PUEBLO ONE - QC EL PUEBLO MANILA – STA.MESALaunched: 2000 *Still under constructionStart of Construction: 2002 Start of Construction:Start of Turnover: 2004 Target date of completion: Mid 2009Total number of phases: 4 Number of units:Current level of completion: Ongoing Phase 3 Bldg. K & L Building A - 295 unitsTargeted date of overall completion and turn-over: Building B - 332 units Phase 3 on Sept. 2008, Phase 4 opens next month. Building C - 470 Units Current number of sales: Phase 1 Units: Sold-198 Available-1 Phase 2 Units: Sold-225 Available-3 Phase 3 Units: Sold-180 Available-70 *As of September 16, 2008.