- Details
- Category: Properties
- 28 Jan 2014
- Written by Rizal Raoul Reyes
IN the Year of the Horse, expect the Philippine property sector to gallop toward growth as more investors recognize that it possesses a sweet spot in all property fronts—office, residential, retail and leisure.
“The Philippine property sector will continue to accelerate in 2014, taking off from last year’s stellar performance. Elsewhere in Asia, markets have slowed down. However, and despite recent calamities, the country’s real-estate sector is a buoyant market and global investors are starting to recognize the country as a top investment spot in Asia Pacific,” said Rick Santos, CBRE Philippines founder and chairman, in a recent press conference held in Makati City.
Santos stressed that investors were bullish despite the recent calamities such as the earthquake that hit Bohol and Cebu, Supertyphoon Yolanda which struck Leyte, Samar and other areas in Central Visayas. With the high demand for space, Santos pointed out vacancy rates were maintained below 5 percent and resulted in an increase of rental rates across major commercial business districts (CBDs).
However, Philippine rental rates remained very competitive globally at $26 per square feet per annum, with Makati still offering the lowest prime rents across major international CBDs.
Joey Radovan, vice chairman of CBRE, reported that Metro Manila and Metro Cebu were identified as the best outsourcing destinations globally, while the information technology/business process sector has been consistently the biggest source of office space.
“Metro Manila and Metro Cebu continue to increase ranking in the top 10 outsourcing destinations as the Philippines established delivery destinations. IT-BPO industry fueled by increased new investments from large and mid-sized foreign providers, and expansions of established locators and captives across many of the country’s upcoming and alternative delivery locations,” said Radovan
“Outsourcing [BPO] and call-center operations, expansion for back office of multinational operations—particularly from banking and finance, health management, and game development—are expected to share in the projected take-up of 600,000 square meters nationwide for the year,” he added.
Meanwhile, Santos said that the BPO sector will continue to grow this year as banks and financial institutions in developed economies transfer their back-office operations to the Philippines and the continuous strengthening of the Indian rupee.
He also said that the residential sector, particularly the high-end segment, will experience growth as China, Singapore, Hong Kong and Malaysia will experience restrictive cooling measures in their economies. This will accelerate the development of luxury residential properties in Bonifacio Global City, Makati, Boracay and other high-end development areas.
CBRE also reported that the country’s retail sector will continue to grow in 2014 boosted by sustained high domestic consumption. Further, the firm reported more than 242,000 square meters of gross leasable area catering primarily to foreign brands and international retailers is expected to enter this year. Retail rental rates remain competitive at $36 per sq. ft. per annum when compared to other areas such as Bangkok ($111 per sq. ft. per annum), Kuala Lumpur ($552 per sq. ft. per annum and Beijing CBD ($674 per sq. ft. per annum).
The remittances of the overseas Filipino workers (OFWs) drive the country’s consumption-driven economy. Cumulative remittances as of November 2013 amounted to $20.6 billion growing at 6.1 percent year-on-year.
The leisure sector will also experience an upswing as more local tourists will be touring the country due to an increase in their purchasing power, mainly because of OFW remittances and the political uncertainty in Thailand.
As of October 2013, the country posted an 11-percent growth in tourist arrivals on a year-on-year basis.
Further, Santos said that the logistics and manufacturing sector will speed up the pace in 2014 as more northeast Asian countries such as Japan and South Korea plan to move their operations due to long-standing territorial disputes with neighboring countries and political uncertainty in Thailand.
In Photo: CBRE Philippines discloses that the Philippine property sector is among the best investment sites in Asia Pacific during its first press briefing held in Makati on Thursday. Present during the briefing are (from left) CBRE Chairman and founder Rick Santos, CBRE Vice Chairman Joey Radovan and CBRE Denior Director Jan Custodio. (Alysa Salen)
No comments:
Post a Comment