China’s bid to ‘rebalance’ economy favorable to PHL, says Neda

Monday, 26 December 2011 21:20 Cai U. Ordinario / Reporter

AS the extent of the financial crisis in Europe unfolds, the National Economic and Development Authority (Neda) looks to other sources of economic growth and sees China’s efforts to rebalance its economy to become more consumption-based favorable to the Philippines’s bid to boost its medium term exports.

Neda Assistant Director General for Planning Ruperto P. Majuca told reporters that the Philippine economy will be able to gain an additional 0.5 percentage points annually in gross domestic product (GDP) between 2012 to 2016 if China is successful in rebalancing its economy.

This means that if the economy grows at its historical average of 5 percent, a successful implementation of China’s rebalancing act may increase this growth to 5.5 percent every year until 2016. For next year, if the economy is able to hit the government’s target of 4.5 percent to 5.5 percent, the China factor could increase local growth to 5 percent to 6 percent.

“In the medium term, it could be 0.5 percent of GDP average per year. Depending on the scenario, the highest impact would be 2014, depending on when they would successfully rebalance their economy, so we’re watching it very closely whether they successfully rebalance toward more consumption based and more imports based in which case it means more exports for us. We could penetrate their market [and] the Department of Trade and Industry [DTI] can work with all these promotions with them,” Majuca explained.

The Neda Official said that currently, China’s sources of economic growth include exports and investments which could not be sustained for a long period of time, considering there are a lot of imbalances. Majuca said around 50 percent of its GDP is composed of investments.

Majuca added that it is already part of China’s five-year plan to move to a more consumption-based economy. A consumption-based economy means that China takes advantage of the spending power of its more than a billion citizens. China is the world’s most populous country with 1.35 billion people.

“It presents a lot of opportunity because they are trying to rebalance their economy. The past economic paradigm of China is investment-led, exports-led, which cannot be sustained in the long run because there are a lot of imbalances,” Majuca said.

It can be noted that data from the National Statistics Office showed that exports to China accounted for 14 percent of total exports and was the country’s third-largest export market. Shipments amounted to $568.02 million as of October 2011.

In May 2007 the Center for Strategic and International Studies and the Peterson Institute for International Economics published the study titled The China Balance Sheet in 2007 and Beyond. The study supported the efforts of China to rebalance its economy since it will not only benefit China’s economy but the entire world.

The study stated that China provides a major boost to global economic growth. With the new growth strategy, domestic consumption demand in China will reduce its national savings rate relative to its investment rate and reduce its current account surplus.

“This adjustment should be facilitated by an appreciation of the Chinese currency, which would mitigate inflationary pressures that would otherwise emerge from the increase in consumption demand,” the report stated.

In 2005 personal consumption in China was 30 percent less in real terms than the level that would have been achieved if the household consumption share of GDP had remained at the 1990 level rather than falling by more than 10 percentage points.

Furniture makers eye higher local sales on condo boom

Thursday, 29 December 2011 21:48 Max V. de Leon / Reporter

Furniture makers have discovered that the domestic market has become as lucrative as the foreign markets so they will now rely on local sales to achieve a 15-percent growth for 2012, the Philippine Exporters Confederation (Philexport) said.

Myrna Bituin, Philexport trustee, told the BusinessMirror there is now a growing awareness among exporters on the strong demand for furniture in the country, particularly with hotels and condominiums continuing to sprout in every major city here.

“Before, exporters were not really into the local market. Now, we have discovered that both the institutional and retail markets in the country could provide us billions of pesos in sales. In fact, we learned that one furniture retailer alone is selling over P1 billion annually,” Bituin said.

Exporters have been spending a lot in establishing a presence in export markets. They have also been devoting about 85 percent to 90 percent of their production abroad.

But this is bound to change, Bituin said.

To further develop the potential of the domestic market, she said, the industry has started connecting with developers contractors, and retailers to assure them that the local furniture makers can meet their requirements.

Bituin said they have already scheduled tours for developers to the different furniture production sites, particularly in Cebu and Pampanga.

What is also boosting their optimism, she said, is the growing preference for locally made products in the country.

“We can feel the growing sense of nationalism among hotel operators and condominium developers,” she said.

Bituin also said they have realized that they can compete with the imported furniture price-wise.

On the export front, Bituin said opportunities woulf be explored in new markets, including China, India and Russia.

“China is a market that we should not be afraid of. We should look at it as an opportunity. Just like us, they also want to buy imported [products]. But for me, I would always look into products that they do not touch. These are the high-end ones and carved items,” she said.

The industry will also start implementing branding programs, improve the value chain and undertake product development.

Fundamentals in property sector remain strong through 2011

Thursday, 29 December 2011 20:13 Rizal Raoul Reyes / Correspondent

THE year 2011 has been a success for the Philippine property sector across all sectors and stronger than 2010. In fact, CB Richard Ellis (CBRE) Philippines Chairman and Chief Executive Officer Rick Santos said there will be a continued show of confidence in 2012 in all sectors of the property industry.

“The success of 2010 was built on in 2011 and this continued show of confidence will be seen in 2012,” said Santos in an e-mail response to the BusinessMirror.

“The Philippine property industry is expected to continue its positive performance in 2012 given the upward momentum that continues to build up in the office sector relative to business-process outsourcing [BPO] office demand is strategic areas across the country, continued rise in overseas Filipino worker [OFW] remittances which is expected to reach $23 billion this year,” added Santos.

He noted that a major part of the disposable income of OFW households benefits the residential, retail, hospitality and leisure sectors of the Philippine property industry.

For instance, Santos said the industrial sector, particularly those that cater to the growing consumer market such as manufacturing and warehousing as well as logistics, is expected to fair well because of the upsurge in economic activities

Lui Matti, executive director for asset services group at CBRE Philippines, said in the same interview that 2011 was stronger than 2010 across all sectors. In the market, Matti said the commercial sector saw the entry of new major players in the BPO industry as well as the continued expansion of major firms.

He said the residential market also continued to enjoy good take-up, with developers focusing on the mid/affordable market segment. Earlier, CBRE said expatriate Filipinos comprised the bulk of the buyers in this segment. “Low interest rates and willingness of banks to lend to capable payers have made it easier for more people to own their first property in 2011,” said Matti.

Environment-friendly and sustainable construction have also emerged as major themes for 2011, with architects, engineers and developers seriously considering the US Leadership in Energy and Environmental Design (or LEED) and the Philippines’s Building for Ecologically Responsible Design (or BERDE) standards in the conceptualization, planning and construction of projects.

In its Philippine Property Market Monitor (November 2011 issue) posted on the company’s web site, Jones Lang Lasalle Leechiu reported that offshore and outsourcing(O&O) companies are looking to expand to next wave cities and urban areas. The company said total leasable floor area for sites in Manila, Tarlac and Davao has an approximate total of 21,000 square meters (sq m). Robinsons Land Corp. alone has started constructing two new BPO buildings in the Ortigas area, which will have around 80,000 sq m of leasable office space.

Based on the projection of a 20-percent growth rate from 2011-2016 by the Business Processing Association of the Philippines, Jones Lang Lasalle Leechiu said the prospect for the local O&O industry in the upcoming years is bright.

Victor Asuncion, executive director for global research and consultancy at CBRE Philippines, pointed out the drivers of the Philippine property industry for the last three years have always been and still are the BPO sector, OFW remittances and the tourism sector.

However, Asuncion said the gigantic collapse of the Lehman Brothers in September 2008 and the capital tightness in the US that lingered in 2009 slightly slowed down the growth of the industry. “However, given its strong demand fundamentals, the industry was able to shake off the negative influences of the sub-prime crisis in the US and resume its impeded growth,” he said. He is also confident the industry will continue to grow in 2012.

He said the affordable condominium market is one segment that has changed the landscape of housing development because it has attracted a lot of buyers from the middle-class and OFW households.

Designed for the middle-class segment, the affordable condominium is an ideal investment for young professionals working in the business districts of Metro Manila as well as start-up families or first-time buyers. This scenario is also being seen emerging in key urban centers such as Metro Cebu and Metro Davao.

As a result of the high demand for this product, Asuncion said major players such as Phinma Properties, DMCI Homes, New San Jose Builders and SM Development Corp. have established a niche in this market segment with more participants such as Camella Condo Homes of Vista Land and Amaia of Ayala Land.

At the rate property developers are putting up office, residential, retail and hospitality products, land bank are being depleted, Asuncion said there is a need to sustain business activity by finding and buying new developable land. “Thus, more hard asset acquisition and strategic business development by major players in the industry is expected going to in2012,” said Asuncion.

Asuncion said the high approval rating enjoyed by the Aquino administration is going to be a plus factor particularly in the property industry as it will continue to attract many investors starting in 2012.

Going into 2012, Santos said the trend to watch is the things that will happen in European economy and whether they will be forced to outsource to cut cost. “More large financial companies will be under increased pressure to save money and will thus outsource their banking support functions here,” he said.

Santos said there will also be a trend toward maintaining good property management of buildings to ensure the loyalty of tenants.

In 2012 Asuncion said he sees new property developments in secondary areas will take longer to sell or lease inventory relative to those situated in prime locations. “This will cause the total industry statistics such as vacancies and lease rates to be challenged,” he said.

For his part, Matti said the government should revise the implementing rules of the real-estate investment trust (REIT) to boost the market even further. Aside from the REIT, he said the government should continue to simplify the way to do business both in the national and local levels and keep the exchange rate within a competitive range.

Cebu Chamber eyes new markets to boost international trade links

By Ehda M. Dagooc (The Freeman) Updated December 29, 2011 12:00 AM

CEBU, Philippines - As the economies of the United States (US) and Europe continue to struggle, the Cebu Chamber of Commerce and Industry (CCCI) is looking at other emerging markets to boost international linkages.

Following the recently concluded trade mission in the north American region, which included Brazil, Argentina, and Chile, CCCI president Samuel Chioson said there is a big potential for Cebu to strengthen ties in this continent.

During the trip, CCCI forged a formal trade linkage with Chile-based traders through the National Chamber of Commerce, Services and Tourism of Chile.

Chioson said the chamber’s target country for trade mission next year, include Eastern Europe as well as Middle East, “we would establish connections with our counterparts there.”

Aside from government-to-government sisterhood agreement, Chioson said CCCI will be forging more trade partnerships with business and trade groups in other countries, just like what it recently did with Chile.

Because of its formal linkage with the National Chamber of Commerce, Service and Tourism of Chile, Chioson said a group of businessmen from Chile is set to come to Cebu next year, in time for the Cebu Business Month (CBM 2012) in June, to meet with the Cebuano traders and counterparts.

“There are a lot of businessmen in Chile who expressed interest to do business with Cebuano traders.,” Chioson said in fact, some of them are interested in investing into real estate, trading, and tourism, among others.

Likewise, Chilean businessmen also see good market potential in the Philippines to sell their well-known products such as wines, pet food, machineries, and dairy products, among others.

Aside from interest in real estate, Chioson said Chilean businessmen also expressed interest in Cebu’s furniture, gifts-toys-houseware products, processed and dried fruits.

Despite the distance, Chioson said Chilean traders displayed willingness to pursue stronger ties and mutual promotion of products and services between the two chambers.

“We see a lot of opportunities in this two-way process of linking with Chilean businessmen. We being in Asia where economic development and growth is expected to come in the coming years, and them being a new emerging market for our local businessmen,” Chioson said.

Members of the National Chamber of Commerce, Services and Tourism of Chile are also now organizing a trip to Cebu in 2012 for the Cebu Design Summit and again in 2013 to attend the Confederation of Asia Pacific Chamber of Commerce and Industry Conference where they will again hold more business matching in Cebu.

Chioson said they would continue to build links and open new markets through more trade missions next year.

Meanwhile, Chioson also encouraged the public sector to strengthen free trade agreements (FTAs) between governments.

“At present we think that FTAs are currently being drafted for these countries. It will be a big help if we can have FTAs as soon as possible so that we can expect more active trading between us and Chile,” said Chioson. (FREEMAN)

Remittances, BPOs fuel real estate

• By Katlene O. Cacho

Wednesday, December 28, 2011

REAL estate in Cebu is booming and the industry is optimistic growth will continue next year, with the continued strong inflow of overseas remittances, low interest environment and growth in tourism and business process outsourcing (BPO).

“Growth in Cebu’s real estate industry continued as is evident in the number of construction projects in the city,” said Cebu Holdings Inc. president Francis Monera.

He pointed out accelerated development within the Ayala-owned Cebu Park District (Cebu Business Park and Cebu IT Park).

Monera said construction in Cebu has become more dynamic and diversified.

“This reflects the increasing number of condominium units, which is expected to grow by 74 percent to over 5,000 units to complete in 2011, together with an expanding office space that may reach some 460,000 square meters of usable area or 15 percent more than in 2010 in Cebu,” Monera said.

Growth drivers

Philippine Association of Realtors Board Inc. – Cebu Realtors Board Inc. (Pareb-Cereb) president Antonina Fritzche credited the growth of the industry to BPOs, foreign students like Koreans learning English here, foreign retirees, Cebu’s warmer climate, surge of overseas remittances and increased purchasing power.

OFW remittances went up by seven percent to $16.534 billion in the first 10 months of the year from $15.456 billion in the same period last year, according to the Bangko Sentral ng Pilipinas.

Attractive financing schemes also boosted the housing sector.

According to Rizal Commercial Banking Corp. first senior vice president and RBG deputy group head for VisMin sales Prudencio Gesta, lending activities this year increased because of the low interest environment. Car and home loans are also on the rise.

The Pag-ibig Cebu branch, meanwhile, reported releasing P688 million as of November this year to finance the home loan applications of 776 borrowers. Pag-ibig estimated 70 percent of these home loans are for house and lot; 15 percent for lot only, and five percent for condominiums.

“Generally, 2011 is a bullish year for property developments,” Fritzche said.

Innoland Development Corp., meanwhile, topped off its flagship mixed-used project Calyx Centre in the Cebu IT Park. The company also announced it will build Calyx Residences, a residential condominium project at Cebu Business Park and The Link, an office-space building also at Cebu IT Park.

Taft Property Venture Development Corp., meanwhile, broke ground last November for its first condominium project, Horizons 101, which will have a total of 1,468 units.

Taft Property chief operating officer Manuel Colayco said Cebu has an unserved requirement of 167,000 units for the middle income category for house units with prices ranging from P1.25 million to P3 million.

Maria Luisa Properties, on the other hand, recently announced its latest premier development, The Heritage, in Mandaue City.

Big players like Ayala Land Inc. and AboitizLand Inc. also unveiled their latest projects in Cebu like Alveo Land’s Solinea and AboitizLand’s Hanaya.

Monera said tourism is a key factor in the continued growth of Cebu’s real estate industry.

“In the past few years, the entry of foreign tourists, businessmen, returnees and local travelers amplified the range of hotel accommodation in the city, which now varies from boutique and businessmen’s hotels, leisure-oriented resorts, five-star luxury hotels and casinos to travelers’ inns,” he said.

Hotel rooms

Monera said Cebu has more than 30 established hotels or some 6,000 rooms that vary from economy to first class.

Developer Megaworld Corp. recently unveiled 8 Newtown Blvd., a condominium development in its 16-hectare The Mactan Newtown project in Cebu. The project is targeted at the retirees market.

“Similar to Hawaiian islands such as Honolulu and Maui, Cebu boasts both natural wonders and urban conveniences, which are appealing to retirees,” said Philippine Retirement Authority (PRA) general manager Veredigno Atienza.

Megaworld inked a partnership with the PRA to facilitate Special Resident Retiree’s Visa (SSRV) applications of qualified foreign clients through their investment with 8 Newtown Blvd.

The firm said construction is also under way for One World Center, a five-level office building designed to serve the needs of top firms in the BPO and IT industries at The Mactan Newtown.

Monera, meanwhile, said plans are underway to start construction of a BPO building within Cebu Business Park as well as the third sequel to the eBloc Tower within Cebu IT Park.

He said that with the success of 1016 Residences, Ayala Land Premier is also set to launch another residential condominium within Cebu Business Park. Avida, on the other hand, also plans to launch a third tower by next year.

Fritzche also said more developers will offer a resort feel and low-rise condominium developments. She said more projects will gear toward the “work-live-play” concept for the young professionals market.

Challenges

When asked about potential challenges in 2012, Fritzche mentioned the lack of support infrastructure and worsening traffic problem as some of the factors that might hamper growth.

“The challenge would be not in selling the development, but in convincing those investors to invest with us when we cannot sustain more buildings,” she said.

Meanwhile, the Philippine Allied Chamber of Real Estate Brokers and Licensed Salesman (PhilAcre) is also asking the government to come up with an effective promotional program to help them sell the Philippines as a vacation destination, especially that global property buyers are now slowly shifting their interest to Asia.

PhilAcre president Anthony Leuterio said international investors, largely Americans and Europeans, are now turning their attention to properties in Asia. He said bulk buying of condominium units is becoming a trend for global investors.

“If the Philippine Government will remain less supportive in promoting the Philippines as a long-term vacation destination like Hawaii, investors’ interest may be snatched by other Asian countries, which actively promote property investments,” Leuterio said.

Published in the Sun.Star Cebu newspaper on December 29, 2011.

London luxury prices set to rise

Dec 2, 2011 - PropertyGuru.com.sg

Prices of ultra-prime London property will rise as much as 10 percent next year according to billionaire property developer Nick Candy, with increasing demand coming from wealthy Asian buyers.

Nick, together with his brother Christian, are the brains behind One Hyde Park, a £1 billion luxury development in the heart of the U.K. capital.

Speaking exclusively to PropertyGuru on the sidelines of this week’s 2011 South East Asia Property Awards in Singapore, Candy exuded confidence about the potential for the very top end of London’s luxury property sector.

He said: “Prices will rise by between 5 and 10 percent in the next 12 months. There’s zero supply and there’s growing demand. London is increasingly being viewed as a safe haven, and for overseas buyers the weakness of the sterling means an increasingly good investment in terms of a currency play.”

One Hyde Park is home to the United Kingdom’s most expensive residence –a £166.4 million (S$275 million) penthouse owned by Ukraine's richest man, Rinat Akhmetov. Australian pop star Kylie Minogue is also an owner at the development. Candy said that 63 of the 80 units have now been sold – the latest happening just this week.

Overseas buyers dominate London’s ultra-luxury property market. Candy said: “A year ago the demand was coming from Eastern Europe, but now it’s buyers from Asia who have become increasingly active.”

And developments such as One Hyde Park will struggle to even get off the drawing board in future. Candy said: “There’s simply no finance. The development company responsible for One Hyde Park borrowed £1.15 billion. That’s not going to happen again anytime soon.”

St. Regis unveils resort in South China

Dec 1, 2011 - PropertyGuru.com.sg

St. Regis Hotels and Resorts has debuted its first St. Regis resort in South China, with the opening of The St. Regis Sanya Yalong Bay Resort.

A premiere destination in Yalong bay, the resort will set a new standard of contemporary sophistication, luxury and unique services for guests to Hainan.

“We are thrilled to unveil South China’s first St. Regis resort — a standout gem along the Yalong Bay coast,” said Sunny Heng, General Manager.

“The St. Regis Sanya Yalong Bay is an exclusive tropical sanctuary with an unrivalled combination of amenities and service, including our famous St. Regis Butler service.”

The resort offers 373 guest rooms and suites and 28 beachside villas, inspired by contemporary architecture. Other amenities include fine dining restaurants and a sophisticated lounge. The resort also features the first Iridium Spa in the South China region.

“Hainan’s Yalong Bay is the tropical playground for China’s elite travelers,” said Qian Jin, Senior Vice President of Operations for Greater China at Starwood Hotels & Resorts.

“The introduction of the St. Regis brand to Hainan offers a new level of sophistication and amenities and redefines Yalong Bay as a destination resort for discerning international travelers who are seeking new experiences with the confidence of the highest levels of service and luxury.”

For the latest property news, trends, resources and expert opinions, visit our property news section. Home buyers, sellers or property renters looking for a Singapore property may like to visit http://www.propertyguru.com.sg today.

Ipoh: A premier investment destination for foreigners

Dec 6, 2011 - PropertyGuru.com.sg

Despite being one of the major cities in Malaysia, Ipoh has been overlooked for almost 20 years, in terms of property investment and development.

However, Peter Chan, Co-Principal of The Haven Sdn Bhd, said Ipoh’s property market has been growing in confidence, especially in 2011, with many new launches taking place.

“It helps that the quality of life is high and prices are among the lowest in Malaysia,” he said.

One good example of property investment and development in the area is The Haven, a new luxury condo project comprising three 26-storey blocks of high-end condo units. The development sits on a 5.44 ha site that features a 1.6 ha lake and is surrounded by nature parks.

“We were confident enough to launch three blocks at the project in one go, instead of the usual one block, which has been the case for Ipoh properties in the past,” noted Chan.

The project was showcased at the recently concluded Malaysia Property Showcase in Singapore and serves as a viable option for retirement or vacation homes for foreigners.

The Haven is priced at almost one-tenth the prices of private properties in Singapore. Currently, prices start from S$185 psf (RM456), with 20 percent of buyers comprising foreigners.

Chinese investors prefer funds to property

Dec 28, 2011 - PropertyGuru.com.sg

Many Chinese investors favour funds and other investment products over property, according to the People’s Bank of China quarterly survey.

In a survey of 20,000 individuals in 50 cities across mainland China, only 16.5 percent listed property as their primary investment choice, a decrease of 7.1 percentage points from Q3.

Around 22.5 percent chose funds and other investment products, while 16.4 percent opted for bonds.

The survey also revealed that 46.2 percent of the respondents expect property prices to stay flat next year, while another 20.8 percent believe that prices will fall. Only 19 percent predicted home prices would increase.

Meanwhile, about 28.5 percent of respondents from Beijing expect the capital’s flat prices to drop, while 26.8 percent in Shanghai are bearish.

Only 13.9 percent of respondents across China stated that they will purchase a flat in the next three months.

PropertyGuru appoints three more heavy hitters

Dec 23, 2011 - PropertyGuru.com.sg

PropertyGuru, the number one property portal in Asia, has appointed three industry heavyweights to key regional positions within the company.

The new senior hires include Douglas Gan, ‘Strategy Guru’, Andrew Batt, Regional Group Editor (pictured) and Sarah Baker, Regional Head of Products, who will all play crirtical roles in shaping the company’s success in the region.

Sarah brings 10 years of digital media experience to her new post at PropertyGuru. Previously, she was Head of Entertainment in Digital Media at Network TEN Australia. Prior to that, she worked at Yahoo!7 in Australia and at Yahoo! UK & Ireland, as well as LineOne, a British Telecom and United News & Media joint venture as the Money Editor.

Andrew has nearly 20 years of experience in the publishing industry. He was previously the Publishing Director for Ensign Media and was responsible for editorial matters for Property Report South East Asia magazine and Thai language edition of Bloomberg Businessweek. He has also worked at Guardian Media and Haymarket Business Publishing.

As for Douglas, he is the co-founder and ex-CEO of ShowNearby, a regional online/mobile location-based advertising business. In 1999, he founded web-hosting business PureHostings.net, and the youth community website OhGenki.com in 2006.

“I’m delighted to welcome three ‘A star players’ into the PropertyGuru family. The impressive track record and experience brought by Sarah, Andrew and Douglas will further support our continued rapid growth and market leading traffic, content, customer services and innovation,” said Steve Melhuish, Group CEO of PropertyGuru.

REDAS, stakeholders assess cooling measures

Dec 27, 2011 - PropertyGuru.com.sg

Looking into the impact of the latest round of property cooling measures, the Real Estate Developers’ Association of Singapore (REDAS) has engaged in series of meetings with various industry players, according to The Business Times.

REDAS met recently with stakeholders such as property consultants, lawyers, developers and brokerage analysts to discuss the intended objectives and consequences of the latest cooling measures, which include the 10 percent additional buyer's stamp duty (ABSD) for foreigners.

The report noted that several suggestions over a more “calibrated” approach were raised at the meetings, including some proposals set to be presented to the authorities.

One idea that emerged was identifying “hot spots” for foreign investments using the postal district codes and applying tiered stamp duties.

Almost 29 percent of private homes in the Core Central Region (CCR), including Marina Bay, Sentosa Cove and prime districts 9, 10 and 11, have been purchased by foreigners, according to a recent CBRE analysis of URA’s caveat data lodged from January to November 2011.

On the other hand, only 14 percent in the Outside Central Region (CCR) were sold to foreigners.

Industry players also suggested that the authorities could give more incentives to support PRs and Singapore citizens by providing more generous subsidies to first-time homebuyers, for instance, instead of singling out foreigners.

On whether the ABSD will be permanent, Joseph Tan, Executive Director for Residential at CBRE, said that “these measures are unlikely to be a permanent feature because of the nature of Singapore's highly open economy.”

CapitaLand completes acquisition of Indian company

Dec 27, 2011 - PropertyGuru.com.sg

CapitaLand, Southeast Asia’s largest property group, announced that it has completed the acquisition of the remaining 60 percent interest in Rattha Somerset Whitefield Hospitality Private Ltd, which owns a site in Bangalore that will be developed into new serviced residences.

The acquisition comes after CapitaLand said in March that it plans to expand its Indian portfolio by acquiring full ownership of four joint venture (JV) companies, which own sites in different cities across India.

Following the completion of the acquisition, Whitefield has become a wholly-owned subsidiary of CapitaLand.

Pollux Properties acquires Geylang Rd property

Dec 27, 2011 - PropertyGuru.com

Pollux Properties, through its indirect, wholly-owned subsidiary, Pollux Treasures, has acquired a property at Geylang Road for S$25 million.

The company said the property comprises a residential-cum-commercial building situated on a 1,350.2 sq m plot of freehold land. It has a maximum plot ratio of 2.8 for residential development and a maximum plot ratio of three for commercial development, and is currently zoned as part-residential / part-commercial / institution.

Pollux noted that the group plans to redevelop the property, subject to approval from the relevant authorities. It added that the acquisition, which is expected to be completed in 12 weeks, will be funded through internal resources and bank borrowings.

Blumont Group cancels planned acquisition of Heritage Residences

Dec 28, 2011 - PropertyGuru.com.sg

Investment holding company Blumont Group Ltd announced that its wholly-owned subsidiary, Raintree Rock Sdn Bhd, has agreed with Bluwater Developments Bhd to terminate the planned acquisition of the latter’s Heritage Residences, a serviced residence development in Selangor, Malaysia.

The company said the termination was due to Bluwater Developments Bhd being unable to fulfil one of the material conditions precedent for the acquisition.

In September 2010, Raintree Rock had agreed to acquire 11 units of The Heritage Residences from Bluwater, and Heritage Lakeside Developments Sdn Bhd was appointed as the manager and operator of the property.

More local investors look to offshore properties

Dec 28, 2011 - PropertyGuru.com.sg

With the bleak outlook on local property prices, more local investors are eyeing offshore properties, said industry watchers and real estate agents.

According to a PropertyGuru survey, 19 percent of over 1,737 respondents polled were “tempted” to invest overseas, up from 14 percent in June.

The poll — conducted before the government’s recent cooling measures — also cited that Malaysia was the top overseas investment destination, with 32 percent interested, followed by Australia with 24 percent, while the Philippines and New Zealand both landed in third spot with nine percent.

As the residential market in Singapore is expected to slow, PropertyGuru also expects the number of foreign and local investors looking overseas to increase in the next six months.

Malaysia-based developer Eastern & Oriental noted a 20 percent increase in inquiries from Singaporean home hunters about its Penang projects.

Analysts believe that the cooling measures have taken some of the heat out of the luxury residential market and this will likely continue next year, as investors turn to opportunities in Western markets. This could affect demand for luxury homes in Singapore, Beijing, Hong Kong and Shanghai, where prices have risen by approximately 25 percent in recent years.

“While we saw very strong activity by high-net-worth investors, particularly from the Asia-Pacific region…the course might change in the next 12 months, where we see more outflow in terms of money going into markets like in Europe, in key markets in the US, by high-net-worth Asian investors,” said Donald Han, Vice-Chairman of Cushman & Wakefield.

Cebu Pacific mounts additional Cebu flights

By Mary Ann Ll. Reyes (The Philippine Star) Updated December 27, 2011 12:00 AM

MANILA, Philippines - Budget carrier Cebu Pacific (CEB) has mounted additional flights to and from Cebu, in time for the arrival of its brand-new Airbus A320 aircraft from the Airbus facility in Toulouse, France.

On Feb. 8, 2012, CEB will add flights from Cebu to the following destinations: Manila (11 weekly flights), Boracay (four weekly flights), Dipolog (three weekly flights), Legazpi (four weekly flights), Pagadian (two weekly flights), and Siargao (one weekly flight).

It will also increase seat capacity from Cebu to Bacolod, Cagayan de Oro, Iloilo and Gen. Santos on the same dates. These routes will now utilize Airbus A319 and A320 aircraft.

CEB will also introduce thrice-weekly Cebu-Kalibo flights starting Feb. 24 and add four times weekly Iloilo-Cagayan de Oro-Iloilo flights starting Feb. 8.

“CEB is the largest airline operating in Cebu, and our passengers have the fastest access to key cities in the Philippines and Asia. With even more flights starting February 2012, CEB continues to offer them the most number of flight options and the lowest fares,” CEB vice president for marketing and distribution Candice Iyog said.

The airline flew 2.56 million passengers in and out of its Cebu hub from January to November 2011. CEB flies the most number of passengers and operates the most number of flights, routes and destinations from Cebu.

“With the addition of the Cebu-Kalibo route in February, CEB offers flights to 20 domestic and four international (Hong Kong, Singapore, Seoul, Pusan) destinations from Cebu, greatly contributing to the access of foreign tourists to the Central Visayas area,” Iyog added.

CEB flew close to 11 million passengers from January to November 2011, a growth of 14 percent as compared to the same period last year. It also succeeded in flying one million passengers each for the months of April, May, October and November, a first for any Philippine carrier.

For bookings and inquiries, guests can go to www.cebupacificair.com, or call the reservation hotlines (02) 7020-888 or (032) 230-8888. The latest seat sales and promos can also be found on CEB’s official Twitter and Facebook pages.

CEB currently operates 10 Airbus A319, 19 Airbus A320 and eight ATR-72 500 aircraft. Its fleet of 37 aircraft – with an average age of 3.6 years – is one of the youngest aircraft fleets in Asia. Between 2012 and 2021, it will take delivery of 23 Airbus A320 and 30 Airbus A321neo aircraft orders, and two Airbus A320 aircraft on operating lease agreements.

Abacus Consolidated sees 2012 as banner year on mining, real estate boost

By Zinnia B. Dela Peña (The Philippine Star) Updated December 27, 2011 12:00 AM

MANILA, Philippines - Listed holding firm Abacus Consolidated Resources & Holdings Inc. said it expects 2012 to be a banner year for the company as it steps up activities in mining and real estate.

In a disclosure to the stock exchange, Abacus president Leonardo Gayao said revenues to be generated from new business decisions would boost its profitability next year.

Gayao said the company approved the assignment or transfer of gold mining rights to fully-owned unit Abacus Goldmines Exploration & Development Corp. The move is in preparation for the entry of a joint venture partner – a Chinese group with whom Abacus has been in talks with.

The assignment, together with the necessary procedure of estimating and appraising the mining rights, is expected to result in an income of P300 million for Abacus.

Aside from this, Abacus is going full blast in its selling efforts in its real estate venture in Batangas as it has already received from the Housing & Land Use Regulatory Board the permit to sell for its MonteMaria real estate project and its condominium units, all located in Batangas City.

Abacus also decided to consolidate the company’s operation, focusing on operations of a non-bank financial institution. It consolidated its investment house subsidiary Philippine Regional Investment Development Corp., which has under its wings a mutual fund, Philippine International Infrastructure Fund, and various real estate development companies.

In line with the consolidation, the real estate holdings will be re-appraised to reflect current values, thereby generating an appraisal increase that is estimated to reach no less than P200 million.

Moreover, Abacus approved the reclassification of its investment in Pacific Online Systems Corp., which will result in book value of the shares by at least P100 million.

Cebu's real estate sector remains upbeat in 2011

By Ehda M. Dagooc (The Freeman) Updated December 27, 2011 12:00 AM

CEBU, Philippines - Cebu’s real estate industry proved to be the most dynamic sector in 2011, and this is expected to sustain in the next few years, as the province gains interest from both local and foreign developers as well as property buyers.

“Growth in Cebu’s real estate industry continued in an upward trajectory as is evident in the number of construction projects in the City, particularly within the Cebu Business Park and Cebu I.T. Park-collectively called the Cebu Park District,” said Cebu Holdings Inc. (CHI) president Francis O. Monera.

Together with its mother company Ayala Land Inc., (ALI), CHI launched several real estate projects in Cebu 2011, bringing in the different brands of ALI, such as Alveo, Ayala Premier, Avida, among others.

For ALI and CHI alone, the company has calculated at least P10 billion projects in the next few years for Cebu, including already CHI’s expansion of the Ayala Center Cebu which will start early 2012, that will incur the company at least P2 billion investments.

“Construction activities around the city have become more dynamic at present with more developments in the pipeline that continue to diversify from horizontal to vertical projects,” said Monera saying that this development reflects the increasing number of condominium units which is expected to grow by 74 percent to over 5,000 units to complete in 2011.

“Together with an expanding office space that may reach to some 460,000 square-meter of usable area or 15 percent than the 2010 inventory in Cebu,” said Monera.

Well known developers had strengthened its presence in Cebu and built series of projects, including new real estate sector investors, some are exporters who diversified their businesses to the booming sector.

Despite the fear of supply glut in the next few years, specifically in the condominium inventories, brokers’ believe that Cebu will not experience what Metro Manila is experiencing, wherein value of condo units dropped to their lowest levels, due to oversupply.

In Cebu however, real estate brokers are confident that thousands of condominium inventories in Cebu will be sold out in the short-term, while interest from both local and foreign buyers is getting stronger.

Anthony Leuterio, president of the Philippine Allied Chamber of Real Estate Brokers and Licensed Salesmen (PhilAcre) said that Cebu will benefit on the movement of international investors particularly from the United States and Europe, looking at Asia as their preferred property investment site now.

Cebu, with its good image in tourism, and as an investment destination is seen to lure more foreign property buyers,--condominium units in particular.

According to Leuterio, based on the profile of property buyers in Cebu in the last few months, his company—Leuterio Realty Company, with a network of over 200 brokers selling properties within the Philippines noted a tremendous increase of foreign buyers in condominium in Cebu. These buyers do not only buy one or two units, most of them are buying bulk number of units—largely for investment purposes.

Leuterio said Cebu’s decision to position itself as a preferred “vacation destination” has paid now, regardless the lack of full support from the government in terms of promotion. He believes that Cebu is blessed with its “Hawaii-like ambiance”, and international investors are preparing to take advantage of this opportunity.

While the international buyers pushed the active and strong confidence of developers to provide more condominium units, Leuterio said some developers also in Cebu are also maximizing the interest of local buyers with their equally strong interest in buying house and lot properties within the Metro Cebu area, as well as in the beachfront countryside locations.

Real estate marking consultant and educator Jun Garing held the first real estate sales forum, designed for condominium selling in the middle of this year.

Garing said, the event was held to equip licensed brokers and learn from the pitfalls of condominium marketing, so that Cebu will be able to be saved from supply gut in the next three years, and inventories of condos will be sustained by strong interest especially from the foreign market.

While interest from the developers continue, Garing whose company is commissioned to market the Filinvest property at the South Road Property (SRP), and also owned a real estate training facility—Salesman’s Centre, said that there is no time for Cebu to prepare for a professionalized condo marketing—but now.

This is because, Garing noted that Cebu’s real estate selling culture, still lacks uniqueness and still has to embrace its maturity level.

In fact, he said Cebu has to adopt different strategies in marketing condominium properties, such as introducing package-selling, condo-tel concept and even fractional-ownership.

Amid the interest from industry players, and buyers, Garing said Cebu has to address the concern of providing good property management services.

Garing, a seasoned real estate seller, said while there are a lot of projects being built here, property management service here has not take off yet.

The boom of real estate in Cebu is here, he said adding that this development should be complemented with the proper and right support services. Otherwise, glut in supply that will result to slide of property value in the next few years will be experienced.

As of latest count, there are a total of 36 developers whose projects have been approved for condominium buildings. This is worth over P100 billion worth of investments. (FREEMAN)

Camella Homes plans more projects for 2012

Ni AJ De la torre (The Freeman) Updated December 27, 2011 12:00 AM

CEBU, Philippines - Due to the high demand of houses in the city, Camella homes has expanded a current project plus eyes more new projects in the coming year.

Just last week, Camella homes opened four new model townhouse units at The Courtyards in Pasadena, Guadalupe, Cebu City. This expansion was thought off due to the high demand of houses, especially in the area, said Camella Cebu North General Manager Myra Lynn Gilig.

Gilig said that with the convenience of the location plus more banks offering low interest housing loans especially with the holiday season, they are bullish that the project would be greatly welcomed by the public.

24 three-bedroom townhouse units would be located at the subdivision which is tagged at P4.6 million to P7 million.

Architect Michael Pizarro, the interior design consultant for some of Camella Homes’ projects here in Cebu, said that for the new units in Pasadena, they have designed it for a specific theme, a laid-back and comfortable living lifestyle.

Pizarro said that they have shifted to a design with neutral colors to “catch the attention of a more discriminating market,” which seeks for comfort, feeling like the home is “away from a busy metropolis.”

Further, Gilig said that they are very happy with the Performance of Vista land, which comprises of business units Brittany, Crown Asia, Camella Homes, Communities Philippines and Vista Residences.

According to Gilig, 60 percent of their growth drivers for this year and the recent years can be attributed to Overseas Filipino Workers.

She said that the strategic and convenient locations of their projects also add up to their good performance every year.

Although Gilig admits that there really is a market for condominium residents and developers in Cebu city, she said that they are not worried because there is a different profile for those who prefer condominiums over houses.

Gilig explained that most of those who invest in condominiums are the younger generation and yuppies but there is still a large market for those who seek houses especially for families and OFW’s who find it best to invest in house and lots.

She revealed that they have increased their market share and also will be opening 14 more projects all over the Philippines in the first quarter alone of 2012.

Three of these new projects would be in Cebu, not counting yet the number of expansions they would also be having next year in their existing projects. (FREEMAN)

Investing in your own home

THURSDAY, 15 DECEMBER 2011 17:53 GEORGE S. CHUA / FREE ENTERPRISE

EVERY Filipino dreams about having their own home, especially this time of the year when the holiday season is in the air and there is no substitute to having a nice Christmas tree in a place you can call your own. How does one turn this dream into a reality? I have some ideas for you to consider.

First is that you have to believe that your dream can become a reality and have a plan towards achieving that goal. Work backwards in determining what is the value of the house or condominium unit you can afford to acquire. There are some rules of thumb that I have seen that give a formula of three times the gross annual household income. So if both you and your spouse are working and each of you get P50,000 each, your gross household income would be P1.3 million. Multiplying this by three times would give you P3.9 million as the value of the house you can afford.

Another way to see how much you can afford to buy a house is by determining how much you can pay in terms of a monthly amortization, assuming you are able to get a bank home loan. From whatever is your take home pay you need to set aside your basic living expenses, such as food, utilities, transportation expenses, tuition and school fees of your children and so on. In the case of rental payments if you are not living with a relative, you can add this back to your available funds to pay the monthly amortization of your loan.

Assuming that you and your spouse could set aside P40,000 a month, at the prevailing interest rate of about 11.5 percent for a 20-year home loan, this means that you can have a home loan for P4,173,913. On a minimum home loan collateral value of 70 percent the home value should be about P6 million which means you need to come up with equity for the difference.

There are a few things you need to keep in mind. First is assuming you are good at what you are doing and know how to take care of your job, chances are over the years you would also be getting more income or pay. While it is possible that things can go really bad like losing your job, it is more likely that not that you will earn more as you become more senior and experienced.

Second, getting a home exclusively on the basis of where you work may be convenient but always keep in mind that the company can change locations, you can be reassigned to a different location or you may even end up working for another company. The best way to mitigate this is get a property that would not only be convenient for you but would also have a good resale value in the event you need to move.

Third, owning a home entails other costs aside from the monthly loan amortization, such as real estate taxes, association dues, and insurance premiums. This means you have to set aside the money for these expenses as well.

The upside to owning a home is the appreciation in real-estate value. This is a nice bonus to having a place to stay. However, as we have recently seen, realty prices could also decline even in very good locations. Not only that, your cost of home ownership could skyrocket for reasons beyond your control such as the jacking up of real estate taxes. You should view your home as a major long term investment that you have to set aside mandatory savings, only after you have provided for this should you even think about other non-essential expenditures. Over longer periods of time, it is a good bet that you will be ahead.

If our government was really serious about helping Filipinos get their own homes and keeping them, there are a variety of ways they can help in. There are a number of ways to do this like allow interest expense to be a deductible expense in our income tax, or keeping real estate taxes at their original levels. The reason local governments jack up real estate taxes is because they claim that the value of the property has gone up! Well yes, that may be so but the property owner does not benefit from that until he sells his property. You can just imagine a retiree whose income stream is already limited and in most cases in a decline, to increase his real estate taxes is like forcing him out on the street. In addition, I have yet to see a local government unit lower real estate taxes even when property prices in there are collapse.

At any rate, investing in your own home is a proposition worth considering. As a major investment proposition, it is unlike other investments that you have little or no control over, you can see where you invested your money in every day, and you are able to enjoy your investment even if there is a momentary decline in the value of your investment. Remember a Christmas tree always looks better in your own home!

Assign your most mundane tasks to your best people

SUNDAY, 20 NOVEMBER 2011 18:30 MICHAEL SCHRAGE

AT a recent dinner with several successful Internet entrepreneurs, the conversation quickly turned to talent. How do you get the best value from your best people? The majority insisted that top talent’s time should focus on the firm’s highest value-added opportunities. Align your best people with the challenges that only they can surmount.

That’s where the contrarian view kicked in—which is one I happen to agree with. Of course your best people should focus on your biggest issues. But one of your biggest issues is—and will always be—the horrendously inefficient scut work that all organizations accrue as they grow. Next Jump’s Charlie Kim, the founder of one of the Internet’s most successful loyalty and rewards programs, argued that as organizations scale, they often slip into less than mediocre processes just to get the job done. These processes are deadly dull to manage and excruciatingly boring to fix.

What talent-loving CEO would assign his best people to such tasks? Kim would. Savvy leaders understand that, as their operations scale, the real barriers to growth don’t have to do with the ingenuity of value-added implementations—they’re found in the necessarily evil support systems and the half-baked infrastructures desperately attempting to support them. Typically, talent-rich organizations assign their mediocre people to solve these seemingly mediocre problems. But that, Kim says, is shortsighted.

Have your most talented people deal with your most stultifying issues. They’ll come up with solutions that annihilate inefficiencies and enable new opportunities for value-added growth. Successfully confronting scut work can stimulate the best of both worlds: rickety, unreliable processes are eliminated and everyone in the organization now has more time and energy to add more value.

That’s a big win. It’s also great for morale. Having your most talented people solve your most mind-numbing problems sends an important cultural signal: Improving organizational efficiency and effectiveness is a priority for both top management and top talent.

It may sound paradoxical, but if your very best people aren’t involved in fixing your organization’s most persistently boring processes, then you’re failing as a leader and a value-added manager. It’s time to get your best people excited about transforming the dull, the boring—and the essential.

Michael Schrage is a research fellow at the Sloan School’s Center for Digital Business at the Massachusetts Institute of Technology. He is the author of Serious Play and the forthcoming Getting Beyond Ideas.