Condo Fever Here to Stay

Wednesday, November 16, 2011

THE condominium fever in the country continues to escalate as the demand among Filipinos for these residential units is expected to rise in the coming years.

In an interview, Jose Luis Matti III, executive director of CB Richard Ellis, said that condominium demand in the country has increased by at least 20 percent in 2011 from 2010.

"Our five-year forecast shows a 70 to 72 percent take-up of condominiums till 2016. These are condos that aren’t built, so that alone shows that 70 percent are accounted for in the next five years," Matti told Malaya Business Insight.

"I think demand is still very high, supply is still a little over the demand, but I think it will be taken up once the buildings are completed. It’s very healthy," he added.

According to Matti, convenience remains the utmost factor behind the popularity of condominiums among local buyers.

Matti noted that a new segment of condominiums is also attracting a lot of local buyers with its affordable price and quality features. This includes mid-priced offerings from DMCI Homes, PHINMA Properties and the Henry Sy-led SMDC.

"They’ve been providing those (affordable units) so it fits in the requirement for those who couldn’t afford the bigger, more traditional condominium types in Makati," Matti said.
"The rising star really is the middle segment dominated by DMCI, SM, PHINMA. Most of the major developers, even Ayala, have competitors in that segment, they’ll have to because those are really in demand and they sell quickly," Matti added.

A big portion of those Filipinos who buy residential condominiums are mostly coming from small families, or professionals who are on their late 20s and mid-30s with stable jobs, Matti said.

"The richer ones who can afford buy them for investment purposes. They sometimes buy multiple condominium (units) for lease because the returns are good especially compared to properties abroad," he added.

"Buyers have an option of leasing it and make money. In five to 10 years, they can sell it at a price at a higher price than they bought it for," Matti said.

"The rental rates are also high enough that sometimes the rental for certain units are enough to pay for the amortization, so basically there’s no cash out for you," he added.

With more options now available for condominium buyers to choose from, Matti said that he is expecting more Filipino families to invest in condominium units in the years to come.

"There are more choices now. Interest rates are also very low now. It’s so easy to borrow, banks are very liquid, they’re willing to lend, more people can afford them (condominiums) now," Matti said.

http://www.malaya.com.ph/nov10/busi2.html

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CB Richard Ellis Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services firm. With over 31,000 employees, CB Richard Ellis serves real estate owners, investors and occupiers through more than 300 offices and 50 countries worldwide. In the Philippines, CB Richard Ellis has established its presence in 1998 and has emerged as the leading real estate service provider through its comprehensive portfolio of offerings: global corporate services, commercial office leasing, BPO/call center solutions, residential sales & leasing, research & consultancy, valuation and advisory, capital markets, and asset services. For more information, visit www.cbre.com.ph or call +632.752.2580.

More Players Seen to Enter Affordable Home Segment

Tuesday, December 13, 2011

SUNDAY, 11 DECEMBER 2011 18:05 RIZAL RAOUL REYES / REPORTER

http://businessmirror.com.ph/home/companies/20504-more-players-seen-to-enter-affordable-home-segment

AFFORDABLE housing, also known as the middle-market residential condominium, will continue to grow in 2012 which will entice more players to enter the market, according to a major property management and consulting firm. 

In an e-mail interview with the BusinessMirror, Victor Asuncion, executive director of CB Richard Ellis (CBRE) Philippines, said affordable will continue to be appealing to a wider segment of buyers which will entice more developers to join the market specifically in the affordable residential condominium segment.

“The primary driver of the affordable housing segment is the growing middle class, particularly those employed by sunshine industries such as telecoms, food and real estate as well as the overseas Filipino workers (OFW)  population,” said Asuncion.

According to government statistics, there are around 8 million to 11 million overseas workers deployed in more than 50 countries. Furthermore, the Philippine Overseas Employment Administration reported that total remittances by OFWs are likely to exceed the P20.1-billion target set for 2011. From January to September this year, total remittances were already recorded at P14.76 billion.

Asuncion also pointed out many developers realize the potential of the affordable housing segment that entices new players to come in. “However, it will make the market highly competitive and we have to separate the men from the boys in the conduct of real-estate development,” said Asuncion.

Asuncion added that the affordable or middle market segment is already well defined. For instance, he said Ayala Land Inc. unit Amaia is focused to serving the horizontal market with its project in Calamba, Laguna for people who want to live in the suburbs.

“If you want affordable housing, you can have this but it will be outside Metro Manila. An example will be the Amaia housing project of Ayala Land in Calamba which is about 50 kilometers away from the Makati central business district.  However, if you want affordable vertical condominiums, then you can choose among the projects of Amaia Land which is also into affordable condominium development. DMCI Homes, Phinma Properties and New San Jose Builders [have projects that] are still within Metro Manila but only in peripheral areas,” said Asuncion.

Meanwhile, Asuncion said he vacancy rate is expected to be at a single-digit low given that there are limited new spaces ready for occupancy for business process outsourcing (BPO) tenants. 

He added the rates hikes will be on a case-to-case basis, depending on the business district location, although vacancy rates will remain low given the lack of new supply. 

Asuncion said additional supply is yet to be added in the second quarter upon the completion of the P7-billion, 33-story Zuellig Building.   

He expects the completion of Zuellig Building will trigger flight to quality given that existing Prime Grade A office in Makati City are at least 10 years old. 

“Given historical take in these business districts and the availability of ready for occupancy space, growth in BPO space development in these areas will be robust in 2012. BPO buildings within the three business districts have high precommitments; new buildings are already at almost full occupancy even before turnover,” said Asuncion.  

Meanwhile, Asuncion said leasing for Grade A and luxury residential condominiums will remain healthy since demand remains healthy due to the expansion in the BPO sector.

Malacañang Announces List of Official Holidays for 2012

Friday, December 02, 2011

Malacañang recently posted the official list of public holidays for 2012 which includes:

A. Regular Holidays
New Year’s Day Maundy Thursday Good Friday Araw ng Kagitingan		January 1 (Sunday) April 5 April 6 April 9 (Monday)
Labor Day Independence Day National Heroes Day Bonifacio Day Christmas Day Rizal Day		May 1 (Tuesday) June 12 (Tuesday) August 27 (Last Monday of August) November 30 (Friday) December 25 (Tuesday) December 30 (Sunday)
B. Special (Non-Working) Days
Chinese New Year Ninoy Aquino Day All Saints Day Additional special (non-working) day Last Day of the Year		January 23 (Monday) August 21 (Tuesday) November 1 (Thursday) November 2 (Friday) December 31 (Monday
C. Special Holiday (for all schools)
EDSA Revolution Anniversary		February 25 (Saturday)

cebu REAL ESTATE MARKET REPORT

CEBU REAL ESTATE MARKET REPORT

OVERVIEW

The Cebu City landscape is continually shifting to an advanced metropolitan centre shaped by
large-scale property developments in the past few years. Recognised as the country’s oldest city,
it is currently positioned as a significant economic player in the real estate industry just behind
Metro Manila.
Cebu City, as part of Metro Cebu, is adjacent to two significant cities in the region, namely
Mandaue and Lapu-Lapu. As a centre of commerce, trade and industry in the Vis-Min region, Cebu
is home to most of the country’s domestic shipping companies, the second busiest sea port
(International Seaport of Cebu),and the second largest number of international flights in the
country (Mactan Cebu International Airport). Moreover, weather in Cebu is highly desirable as it
receives only minor typhoons and is nowhere near the earthquake belt. With this, it has continually
drawn investors as its economic environment makes the metropolis favourable for business
activities.
The influx of major industry players such as Ayala, SM and Filinvest strengthens Cebu City’s brand
as a major destination for businesses related to BPO (particularly call centres), hotel & leisure and
residential condominiums. Furthermore, real estate developments in the urban centre gave rise to
three business districts, i.e. Downtown Cebu, Asiatown I.T. Park and the Cebu Business Park.
Construction activities have become more dynamic at present with more developments in the
pipeline that continue to diversify from horizontal to vertical projects. This reflects the increasing
number of condominium units which is expected to grow by 74% to over 5,000 units to complete
in 2011, together with an expanding office space that may reach to some 460,000 sq m of usable
area or 15% more than in 2010.
In addition, the infrastructure facilities, including the 12 km four-lane South Coastal Road are now
in place together with the planned Bus Rapid Transit System which is intended to improve traffic
across the metropolitan area. This, together with the future projects in the South Road Property,
a 300 hectare PEZA registered property found near the coast of Cebu City, is expected to boost
commercial and residential development in the area including the planned 25 hectare mall by SM
Prime Holdings, and a residential condominium (Amalfi Oasis @ Citta di Mare) by Filinvest Land
Inc. of which the first building is set to complete by year-end.
Cebu’s BPO sector remains upbeat with the expansions of existing companies and the increase of
Call Centre and IT firms interested in locating in the city. Some of the new companies expanding
in the area include HP, Fluor Daniels, Dell and JP Morgan & Chase. BPO companies are continually
drawn to Cebu City as it benefits to a significant number of workforce and its healthy fiscal
environment. With an expected population of almost 1.5 million (Metro Cebu) by year-end
supported by nine large universities, the labor pool makes a wide selection of skilled workers.
Tourism remains a key growth driver in Cebu with more than 30 established hotels or some 6,000
rooms that varies from the first class to the economy type. Government data shows that Cebu
ranked as the third most visited destination last year with around 1.77 million domestic and
international visitors or a 9.7% increase over the same period in 2009. In the past few years, the
entry of foreign tourists, businessmen, balikbayans and local travellers amplified the range of hotel
accommodation in the city which now varies from boutique and businessmen’s hotels, leisureoriented
resorts, five-star luxury hotels & casinos to traveller’s inns.

READ MORE CLICK HERE

11 Hurrays for Philippine Property in 2011

Tuesday, December 13, 2011

by Tessa Salazar, Philippine Daily Inquirer

http://business.inquirer.net/34349/11-%E2%80%98hurrays%E2%80%99-for-philippine-property-in-2011

Despite the lower-than-expected economic growth for the Philippine economy in 2011, some sectors posted promising growth this year, particularly the property sector.

Just recently, Paul Vincent Chua of global real estate services Colliers International said there have been positive points about the city of Manila as a property investment option, particularly the lower rental rates compared with other Asia-Pacific countries. Last Saturday, property analyst Enrique M. Soriano said this year saw the “aggressive construction frenzy in the mid-income condo segment representing 80 percent of all residential developments in 2011.”

During the first quarter of the year, attractive financing schemes boosted the housing sector, among others. Inquirer (Business) came out with a report that taking out a loan for a home (or a car) has become easier than ever, with some of the lowest interest rates and flexible payment terms. Some banks offered loan approvals in 24 hours or less, and large discounts to reward prompt payments.

Other encouraging news from Colliers came out recently, such as the increased demand for office spaces in the Makati, Bonifacio Global City and Ortigas central business districts compared to 2010, and the “arrival” of growth centers like Eastwood City and Bonifacio Global City.

Over at CB Richard Ellis Philippines, the real estate advisory firm shared its own good news for 2011, two of the most “heartwarming” being the Philippines dubbed the best outsourcing destination in Asia, and the City of Manila as generating one of the highest office yields in Asia.

The CBRE study compared 16 central business districts across Asia, and those of the Philippines came out as charging the third-cheapest lease rates at US$19.1 per square foot/per annum, next to Jakarta’s $16.3 and New Delhi’s $12.7. This ranking came about despite increasing office lease rates in Metro Manila and declining vacancy rates in 2011. The other CBDs in the study are Tokyo, Singapore, Hong Kong, Mumbai, Beijing, Shanghai, Seoul, Taipei, Ho Chi Minh, Hanoi, Gunagzhou, Kuala Lumpur and Bangkok.

Victor Asuncion, executive director for global research and consultancy of CBRE Philippines, shared his own 11 property news in 2011 that would encourage us to see the Philippines as a “glass half full.”

1.) A record year for office takeups. 2011 is turning out to be a record year for office takeups, which is now estimated at 300,000 to 400,000 square meters.

2.) Year of the branded hotels. Hospitality developments aimed at the rising office and business community population have attracted branded hotel projects such as Shangri-La at BGC, Grand Hyatt and Fairmont Hotel to establish their own hotels here.

3.) Serviced apartments on the rise, too. Investments for, and the development of, serviced apartments has started in earnest, as business travelers such as business process outsourcing trainers and consultants are streaming in for the medium term—the main clientele of serviced apartments.

4.) Cheaper alternative for foreign carriers. Expansion as a result of a liberalized airline industry has enabled more foreign carriers, such as Air Asia, to provide cheaper air transport alternatives to millions of inbound and outbound travelers.

5.) Retail projects go nationwide. They’re not just confined to urban centers. Supermarkets, “hypermarkets,” malls and other big-ticket commercial establishments that focus on retail are now being put up across the country, with no less than property heavyweights such as Ayala Land, SM Prime, Robinsons Retail, Puregold PriceClub, Rustans and Waltermart behind these projects.

6.) Increased consumer spending. People are spending more—for home, communication and personal items, and especially for food. This literal hunger fuels the expansion of fast-food chains, retail kiosks, as well as beverage shops specializing in coffee, milk tea and frozen yogurt, to name a few.

7.) Vertical communities on the rise. Young urban dwellers as well as start-up families now tend to look more at the option of living in middle-income vertical communities (such as condominiums) in Metro Manila that are in close proximity to the business districts.

8.) That closer to REIT. The Bureau of Internal Revenue has released the Implementing Rules and Regulations for the Real Estate Investment Trust Act (REIT Law) of 2009. This has been considered a step closer to the listing of the first Philippine REIT company at the Philippine Stock Exchange, subject to the acceptance of the stakeholders.

9.) New hotels for tourists. If you build it, they will book. Increased confidence in the business of tourism has encouraged new hotel developments in key tourist destinations such as Boracay, Cebu, Davao, Cagayan deOro, Palawan, Clark and Subic. Their efforts are now being rewarded as foreign and domestic tourist arrivalsare increasing.

10.) The new destination for medical tourism. Foreign investments in the country’s medical facilities bode well for the emergence of the Philippines as a major medical tourism destination. Upgrading and expansion of tertiary hospitals provide options and alternatives to medical tourists as well as retirees—be they balikbayans or foreigners.

11.) Bay area developments. The best place in Metro Manila to see the setting sun may also be the ideal place to witness the reemergence of Manila’s economy. Bay Area developments have been a blur, aimed primarily at Asia’s gaming and gambling scene—a guaranteed index of economic growth. The Pagcor City and Belle Grande Casino Resorts Manila will soon be operational.