Chamber of Real Estate & Builders’ Associations, Inc.

"A Home for every Filipino"

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"Long-term and affordable funds for socialized and economic housing"
A PROPOSED BILL AMENDING REPUBLIC ACT 7835 OR THE COMPREHENSIVE AND INTEGRATED SHELTER FINANCE ACT (CISFA) OF 1994
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"Affordable homes for employees in urban areas"
PASSED AS R.A. 10084 OF 2016
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"Lands for Human Setlements, Agriculture and the Environment"
A Porposed bill institutting a National Land Used Policy.
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"Efficient local government housing regulations"
A proposed bill amending related provisions of Republic Act 7160 or the Local Govenrment Act of 1991
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"A proposed bill creating the "Department of Housing and Urban Development (DUHD)"
PASSED AS R.A. 11201 OF 2019
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5 key trends that may influence PH real estate



BY: CHAMBER OF REAL ESTATE AND BUILDERS' ASSOCIATIONS, INC.
April 29, 2020

POSTED IN: Local Industry Snapshots
By: The Manila Times

The Manila Times | April 28, 2020

REAL estate developer Federal Land Inc. is optimistic that the local real estate industry is expected to continually grow in 2020 despite the challenges it has been facing.

 

“There are always challenges ahead but the groundwork for a positive industry head start has already been established by the prior year,” said Federal Land General Manager Thomas Mirasol. “Thus, continuing the positive momentum of the real estate industry can be based on trends that have surfaced from 2019.”

 

Mirasol sees five key industry trends that could influence the trajectory of Philippine real estate in the next 12 months.


 

Booming economy and sustained demand for luxury offerings, with Manila as top locale
In Santos Knight Frank’s “The Wealth Report,” Manila ranked as the top luxury property market for 2019, with an 11-percent annual growth on prices. The shortage in available supply in the country’s booming economy influenced expatriates and other investors to acquire their slice of real estate in the emerging Philippine market.

 

Mirasol points out that this increase is a spill over to demand for high-range property offerings reflected by high pre-selling take-up for luxury condominiums in established metropolitan areas like Manila and Makati.

 

“The inflow of high-earning C-level executives, tourists and investors drives the demand for high-tier properties as we’ve experienced with The Estate Makati — our joint ultra-luxury residential project with SM Development Corp.,” said Mirasol. “Even before the project was launched in September, 40 percent of the total units have already been sold.”

 

Mirasol also acknowledged how Philippine offshore gaming operators have been driving demand in the property sector since the previous year, particularly in the new economic hubs located at the fringes of major cities.

 

“Chinese occupants are also sustaining the demand for mid to luxury condominium developments as we’ve experienced with Mi Casa and Palm Beach West — two of our projects in the Bay Area,” said Mirasol. “These have all added to Federal Land’s outperformance for growth in sales in 2019 when we expanded from P11.2 billion to P22.9 billion. This growth of 104 percent takes into account revenue from joint-venture sales as well.”

 

Sustained regional development

Outside Luzon, further development of regional central business districts (CBDs) is anticipated following the government’s plans of decongesting the capital.

 

In Visayas for instance, Cebu will continue to reign as a property investment destination with the expected influx of tourists and business investors. This also includes foot traffic driven by the meetings, events, conventions and exhibition/events (MICE) tourism brought about by the expanding Mactan-Cebu Airport. Colliers International, however, notes that while rising prices in land and less developable land in the Queen City of the South is increasing demand for condominiums, developers must also scout for properties outside the main metropolis.

 

 

“Like Cebu, Bacolod and Iloilo have direct access to expatriates and tourists from different regions of Asia. We’ve noted that affluent families from those two emerging economic hubs are still investing in Cebu properties which clues us into market preferences and opportunities for development in these areas,” said Mirasol.

 

Increased competition influencing property offerings and amenities

 

Consumers and property buyers will be the real winners in 2020. According to Colliers, the increase in supply of property developments will pressure developers to offer unique upscale amenities, as well as provide better access to office towers and shopping centers.

 

Mirasol said this allows developers to exercise more creativity in projects. This exactly what they did when Federal Land launched The Grand Midori Ortigas in Ortigas CBD. The property is strategically located near business districts and retail hubs between the north and south of Metro Manila.

 

Developers can capitalize on the government’s infrastructure push by complementing it with residential developments. Federal Land’s 10-hectare township in Bonifacio Global City (BGC), Grand Central Park will benefit from these transportation projects like the BGC -Ortigas Link, Metro Manila Subway and the Skytrain Monorail.

 

Another project, Quantum Residences along Taft Avenue, is a highly sought-after residence because of its prime location near premier colleges and universities as well as direct access to the CBDs in Makati, Manila and Pasay City. The property caters to the mid-income market, this year’s most attractive segment, and features upgraded amenities compared to other projects in the vicinity.

 

“While differentiating our projects from others in the market has always been a driver of the properties we release, we see how the market taste has evolved from the practical hunt for property to the search for a residence that supports the lifestyle they desire to have,” said Mirasol.

 

Partnerships with international developers yielding local best practices

 

“The good thing about development in this decade, is that we do not have to drive it alone,” Mirasol said. Reflecting on the performance of their launches last year, he noted that Federal Land’s most ambitious launches were successful due to the partnerships they have entered into particularly with The Estate Makati, The Seasons Residences and The Grand Midori Ortigas.

 

Apart from the buzz created by their collaborations with Foster + Partners as well as with Nomura Real Estate Development Co. Ltd. and Isetan Mitsukoshi Holdings Ltd., Mirasol underlines that international partnerships like these keep the property sector “young” and capable of adjusting to emerging needs. International developers entering the market encourages their local peers to embrace bold ideas while infusing the industry with best practices harnessed from their global expertise.

 

Opportunities blossoming for sustainable building

 

Finally, with the resurgence of environmental concerns and frequency of natural calamities and disasters, the local real estate industry is expected to gear up and address climate change. According to real estate services firm JLL, developments around the Asia-Pacific region are set to become greener and more sustainable as they employ energy-efficient technology and environmentally friendly materials.

 

Addressing local concerns, Mirasol lauds the presence of LEED (leadership in energy and environmental design)-certified sustainable buildings but underscores disaster resilience as a crucial component of future sustainable structures as well such as The Seasons Residences, which has features that enable it to withstand shaking caused by earthquakes and buffeting from strong winds.