THE Gokongwei family’s
property arm is turning its attention back to Cebu City, where the
clan’s business empire traces its roots, amid tougher competition from
rival business families like Henry Sy’s SM Group, which is also
aggressively expanding in that city.
Robinsons
Land Corp. (RLC) said it started work on Robinsons Galleria Cebu, a
seven-story mixed-use building in the North Reclamation area, which it
claims is its largest commercial development outside Metro Manila.
Analysts said the
move underscores Cebu’s growing importance as a tourism and outsourcing
destination—a fact not lost on the country’s top builders seeking to
take a bigger slice of the province’s booming growth.
The
island has recently diversified its economy to become a business
process outsourcing (BPO) hub “second only to Metro Manila”with tax
incentives and advanced telecommunications facilities helping to lure
investments, said Claro Cordero Jr., head of research and valuation for
Jones Lang LaSalle Leechiu, a property consultancy and brokerage firm.
“This
phenomenon has helped improve the general purchasing power of [Cebu’s
] local economy,” Cordero said in an emailed response on Thursday. “The
general outlook is that the O&O [off-shoring and
outsourcing ] companies are still likely to operate and expand in Cebu
in the medium- to long-term.”
Robinsons
Galleria Cebu will include a 56,000 square meter (sqm) shopping mall, a
153-room gohotel.ph budget hotel, and business process outsourcing
offices. Slated for completion by 2014, it will have a gross floor area
(GFA) of 156,000 sqm, but the master plan for the 4.6-hectare lot also
includes residential condominiums, RLC president Frederick Go said in
the statement.
The
new project comes as RLC’s closest competitors are building even
larger shopping facilities. Sy-led SM Prime Holdings Inc. opened last
month its second shopping mall in Cebu, called SM City Consolacion, with
a GFA of 106,857 sqm.
In
2014, its opens SM Seaside City Cebu, its biggest shopping center
there, with a GFA of 241,600 sqm. SM Prime is also reportedly in talks
to acquire a fourth site in Cebu.
Apart
from the Sys, Gotianun-led Filinvest Land Inc., which is already
developing residential condominiums in Cebu, said it will build a
business process outsourcing complex in the reclaimed South Road
Properties area. Ayala Land Inc. also operates a shopping center in
Cebu apart from residential projects.
Cordero said the growing trend of property developers expanding in Cebu is unlikely to see a reversal anytime soon.
“Coming
from a low base in terms of high-rise residential projects of highly
dense projects, the highly improving purchasing power of the consumers
is seen to sustain these developments and saturation of the market is
still far from the horizon,” Cordero said.
The
integrated approach of these builders, he said, attracts both end-users
and investors, but not without opening up its own set of risks. “This
type of demand [buying for investment purposes] is highly-susceptible to
market externalities such as the weak global economic recovery,” he
said.
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