San Miguel brings its airport plan to President Aquino

CLIFF VENZON, Nikkei staff writer

This rendering shows the airport San Miguel hopes to develop on the east side of Manila Bay.

MANILA -- San Miguel has pitched its plan to build a massive airport to President Benigno Aquino.

     The unsolicited proposal -- which comes amid constant criticism of this metropolis's aging and dilapidated aviation hub -- was formally presented to Aquino on Wednesday, San Miguel President Ramon Ang said late Thursday.

     Details were first disclosed by the Nikkei Asian Review in March.

     A copy of the proposal handed to Aquino and Transportation Secretary Joseph Abaya shows the $10 billion airport would feature three terminals -- one main hub for full-service carriers and two terminals to serve the growing budget travel industry.

     The airport would have four runways and 164 contact gates; it would be able to accommodate more than 100 million passengers per year, the copy shows.

     "You can be sure that there will be no congestion for the next 30 years," Ang told reporters on the sidelines of a Philippine Airlines event Thursday. The flag carrier is 49% owned by San Miguel, also known for its beer.

     The entire plan would require a 16 sq. km reclamation project. The airport would take up half of that area, with retail space, a cargo zone, aircraft maintenance center and aviation support hub sitting on the remainder of the land.

     The airport would be located on the eastern side of Manila Bay, in the southwest of greater Manila, according to a blueprint prepared by American airport master planner Aecom.

     The project would also include the construction of an 18km express railway and 15km expressway linking the airport and Manila's central business districts. According to the plan, it would take 11 minutes on the expressway to get between the Makati central business district and the airport.

     Ang said San Miguel was open to partnering with other Filipino conglomerates such as SM Investments, the Ayala Group, and even with Philippine Airline rival Cebu Pacific.

     Ang is also holding the door open to challengers. "It is a suggestion for the government to call for a public bidding," he said. "I don't want people to see that we have an advantage more than everybody else." 

     The government has repeatedly said it prefers to solicit projects rather than field unsolicited proposals.

     Aquino's office would not say if the president is leaning toward San Miguel's proposal.

     Presidential spokesman Herminio Coloma said the proposal still has to be evaluated by the transportation and socio-economic planning departments.

     Abaya texted the Nikkei Asian Review that he would set up another meeting with Ang about the project.

     "We will provide them more details," Ang said.

     Manila is in dire need of a new airport. The 33-year-old Ninoy Aquino International Airport, the country's primary gateway, sits on only 4 sq. km of real estate. Last year it handled 32.8 million passengers -- well beyond its official capacity.

     One of its two runways only opened last year. The airport is marred by frequent flight delays and dilapidated facilities. An online travel guide has voted it the world's worst airport.

     San Miguel, the Philippines' most diversified conglomerate, said the new airport would be a boon to the country's drive to boost tourism and reflect the country's economic growth, which stood at 7.2% last year, the fastest in Southeast Asia.    

     The airport "will outclass everybody in the region," Ang said in an earlier interview.

Ang seeks partners with $7 billion in airport bid

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Category: Top News

16 May 2014

 

Written by Lorenz S. Marasigan

SAN Miguel Corp. (SMC) might allot as much as $3 billion in equity to fund its proposed $10-billion airport, as it scouts for partners to develop the international gateway in a large chunk of land in the southern part of the metropolis. 

SMC President and Chief Executive Officer Ramon S. Ang on late Thursday revealed the particulars of his planned air hub, noting that the airport would be built in a 1,600-hectare land in the cities of Parañaque and Las Piñas. 

He met with President Aquino on Wednesday to present his plan, which was “very much liked” by the Chief Executive. 

The businessman said he merely presented the airport plan to the President, adding that the project would be subject to government auction. 

“They [government] will put together the idea, and they will call for a public bidding. I will not ask the government to give me a right of first refusal, that’s not right. So what we presented is a good idea, a good project, and I don’t want people to say that I have an advantage over anybody; so it’s okay for me to call for a public bidding to give equal chance, equal opportunities to build this airport,” Ang said in an interview. 

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“The airport will have complete features, including a general aviation office, maintenance facilities, a low-cost carrier terminal, a train system, a dedicated tollway—everything that you need will be built on that 1,600-hectare land,” he said. 

Earlier reports quoted the businessman as having said the airport would be constructed on an 800-hectare land somewhere in the south. 

“What we submitted to Malacañang was the best and the largest plan, of course,” he said, referring to the larger patch of land. “The 800 hectares would only be for the airport alone.”

He said the proposal included the structure of the project, which would be implemented under the build-operate-transfer scheme. 

The airport, he said, will have four runways to ensure the smooth flow of air traffic for the next 30 years. 

“So when you board an airplane, in less than five minutes it will already take off, so you won’t have to wait and sit for 45 minutes to an hour before flying,” Ang said.

“An arriving aircraft doesn’t need to keep circling overhead; it can come direct, descend direct, and land direct,” he said. 

The businessman said he plans to partner with a firm to jointly develop the airport, but that he has not talked to any company to tie up with. 

“We are not yet in talks with anybody but if we were to have a partner, I will invite a Filipino company...Cebu Pacific can also build a low-cost terminal there, and if we are allowed to partner with many entities, we are open to anybody,” he said. 

Ang, who also serves as president and chief operating officer of Philippine Airlines, said getting another carrier operator as a partner would not be a problem to him. “If you are thinking about the good of your country, you wouldn’t worry about that anymore,” he said.

Even with the partnership, Ang said SMC may allot as much as $3 billion in equity to fund the construction of the airport. 

“We don’t have the financial details yet, but to build that unit maybe [we could allot] 20-percent equity or at least a $2-billion to $3-billion equity [for the building of the airport],” Ang said. 

He said he expected to see investments return by the airport’s 15th year of operation. 

Earlier, Transportation Secretary Joseph Emilio A. Abaya said the government was open to the proposal, but noted that it would still review the prospect to determine its structure. 

“We will provide them all the details that they need,” Ang said, referring to the agency’s call for him to present the planned airport. 

Owners change resort’s brand to attract wider Asian market

By Mia A. Aznar

Wednesday, May 7, 2014

Imperial Palace Waterpark Resort and Spa will be known as JPark Island Resort Cebu starting next month in line with the company’s plan to develop other types of properties, says external affairs director Reno Bacolod (right) during a press conference with (from left) Dorinda Lim, front office manager; Myla Mohammad, director of sales and marketing; and Sean Noh, general manager. (Jonolin Luab)

THE developers of a five-star resort in Mactan announced the rebranding of their property “to facilitate growth” for the company.

Beginning June, the Imperial Palace Waterpark Resort and Spa will be known as JPark Island Resort Cebu.

Officials of Philippine BXT Corp., operators of the hotel, explained that change was due to expansion plans that the company hopes to pursue that the Imperial chain is not offering.

Senior sales and marketing manager Angela Emphasis said that the Imperial Palace brand is limited to hotels. The company, she said, hopes to grow its business by developing other properties that may not include a hotel facility.

PBXT director for external affairs Reno Bacolod said these properties include hotels, resorts and amusement centers around the country and overseas.

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Public

He also announced plans of the company to go public. But he said nothing has been finalized and the company still does not have a timeline.

“We have to consider many factors like the receptiveness of the market, our growth factor and the selling price. We are doing our homework and we are not limiting ourselves to the Philippine exchange,” he told reporters yesterday. He cited the Korean and United States bourses as some of their options.

But until this is finalized, Bacolod said they will focus first on developing the JPark brand and expanding their projects.

Bacolod said the company is considering developments in Boracay, Palawan and parts of Luzon. They are also eyeing international locations but Bacolod would not give details.

He said the name JPark refers to the Filipino and Korean owners of PBXT.

He said the brand aims to be “very Asian” to attract travelers from Southeast Asia, China, the Middle East and Russia, along with their existing clients from South Korea, Japan and local tourists.

Arrivals

Sales and marketing director Myla Mohammad assured that they still expect a robust South Korean market even with the name change, saying they are still seeing many arrivals from South Korea. However, they also want to promote the hotel to emerging markets.

Mohammad said she is optimistic about the Chinese market as the travel ban on the Philippines has been lifted and there are at least two chartered flights from China
expected to arrive in Cebu between June and September.

Aside from leisure tourists, Mohammad is also seeing a large market in MICE (meetings, incentives, conventions and exhibitions) from Southeast Asian countries.

Bacolod said there will be no drastic changes in the hotel and also among its staff.

But he said there are some adjustments, like the new features in the check-in and check-out process, Asian-Mediterranean fusion cuisine to meet the dietary demands of target markets, and the construction of a mini golf course and go kart track for children.

The property is also leasing an international casino within the property, which set to open in July.

Front office manager Dorinda Lim said they are shifting from the traditional way of checking in to a more contemporary set-up. To make things faster and easier, they have separated their check-in counters into three for high-profile guests, frequent individual travelers and group travelers.

Bacolod also assured that they want to be “tech savvy” in their systems.

Although they did not give details on the kind of project they are working on next, Bacolod said they will unveil their first expansion next year.

Upgrades from Fitch, Moody’s likely to follow

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10 May 2014

 

Written by Bianca Cuaresma

ECONOMISTS believe it is likely that another upgrade is due the Philippines this year from other major credit watchers, given the country’s strong economic prospects for this year and next.

The BusinessMirror sought their views on the possibility of another raise in the ratings for the Philippines—this time from Moody’s Investors Service and Fitch Ratings.

On Thursday Standard & Poor’s (S&P) upgraded the country’s sovereign credit ratings to “BBB” from “BBB-.” What this meant was that for S&P, the country is now on the second of three steps in the investment-grade status. This was the highest rating that the Philippines has been awarded to date.

“Yes. I think Fitch and Moody’s will follow along. After all, the same macro story is seen by all these [rating agencies], and it’s very easy to see that a macro story is hard to contest,” Security Bank economist Patrick Ella said in an e-mailed response to the BusinessMirror.

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In its earlier visit to the Philippines, Fitch maintained its rating for the country and left its outlook unchanged. Moody’s was the only one among the three major rating agencies that assigned a “positive” outlook for the country, which meant that the country can be up for an upgrade in the next 12 to 18 months after its recent rating assignment. Moody’s lifted the country from the junk status to investment grade in October last year.

“It is likely that other ratings agencies would review their recent assessment,” ING Bank economist Joey Cuyegkeng said in a separate response to the BusinessMirror.

First Metro Investment Corp. Senior Vice President and Head of Financial Markets Group Reynaldo Montalbo Jr. is also of the view that Fitch and Moody’s may follow S&P’s action, but “not necessarily immediately.”

Montalbo also said the most immediate impact of the recent S&P upgrade would be seen on the interest-rate differential between local yields and the US treasuries as it would likely tighten due to the positive sentiment on the Philippines.

“The 10-year differential has been hovering at around 170 to 180 basis points. This is very wide considering our strong economic fundamentals, the slow US economic recovery and the very predictable Fed quantitative easing taper. This differential, especially on the long end, 20 to 25 years, should tighten as a result,” Montalbo said.

The local financial markets, likewise, reacted swiftly to the S&P upgrade. On the last trading day of the week, the Philippine Stock Exchange index was up by 1.21 percent while the peso regained its value back in the 43 territory—appreciating by more than half a peso on Friday on the back of the Philippines upgrade.

“In an environment of calm in US monetary policy, our economic fundamentals would dominate and support Philippine financial markets and economy,” ING’s Cuyegkeng said.

FortuneCare chosen as health-care provider of MultiRational

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Category: Banking & Finance

07 May 2014

FORTUNE Medicare Inc. (FortuneCare), one of the leading companies in the Philippine health-maintenance organization (HMO) industry, has signed a one-year contract to provide health-care benefits to members of the MultiRational Corp., an Australian company engaged in offshore insourcing, a business method that disperses work within a company.

In photo, taken at the recent contract-signing at the MultiRational Conference Room in PBCom Tower, Makati City, are (from left) Paul Tweddell, MultiRational general manager;  Graham Gulliver, chief executive officer; and Neville Reyes, FortuneCare senior vice president, corporate sales and services. 

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Standing behind them are FortuneCare executives Janrich Basilio, Maria Labuena Gerardo and Jenny Cabacungan; Jonathan Serrano, Michelle Donato and Arthur Viven-Malicse of MultiRational; and Louies Ceazar Ibarra of FortuneCare.

Cebu hotel posts P33-million revenue from room charges

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Category: Companies

07 May 2014

 

Written by Roderick L. Abad

WATERFRONT Cebu City Hotel & Casino (WCCH) has generated about P33 million in revenues from room charges over the last 12 months, a top executive said.

WCCH Group Reservation and Distribution Manager Joson Lim told the BusinessMirror that the amount earned from April 30, 2013, until the end of last month is equivalent to approximately 10,000 total room nights. “We attribute such achievements because of the consistency of our product and services,” he said.

With the improved performance of the hotel, Lim revealed that they expect to make a room topline of P44.5 million or 14,000 total room nights by the end of 2014.

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He expects to realize this target by “being fully engaged with the marketing programs of our online partners, and still keep the high consistency of delivering high-quality products and services.”

WCCH is part of the Waterfront Hotels & Casinos chain of properties nationwide. “As a city hotel, we are the top of mind choice because of our location at the center of Cebu City, which is very near to the financial and commercial hubs in the metro,” said Lim, saying this has made the hotel an ideal venue for international events, concerts and conventions.

Recently, WCCH has been feted for the second time as the top producing hotel in the four-star category during the recently concluded 2014 Expedia Partner Awards.

Expedia is a leading global online travel agency web site, featuring some of the world’s top online travel brands.

Megaworld to invest P8 billion for Cebu township hotels

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Category: Companies

08 May 2014

 

Written by VG Cabuag

PROPERTY developer Megaworld Corp. will spend P8 billion to develop several hotels in its township project in Lapu-Lapu City, Cebu. The company said it will build five hotels in the 28.8-hectare Mactan Newtown, with cumulative portfolio of 2,000 rooms.

The first two high-rise hotels—Mactan Belmont Luxury Hotel and the Savoy Hotel Mactan Newtown— will be operational within five years. Two beachfront hotels will rise in the former Portofino Beach Resort in the area.

Another luxury hotel is also expected to rise in the township, the company said, although it declined to name the brand.

“With the influx of more tourists to Mactan Island year after year, we hope to be able to offer more exciting facilities that will help further boost tourism in the region. Aside from local tourists, we hope to cater to foreign guests and visitors to The Mactan Newtown as well,” Carmen Fernando, managing director of Megaworld subsidiary Prestige Hotels and Resorts Inc., said.

Prestige will be the operator of Mactan Belmont Luxury Hotel and Savoy Hotel Mactan Newtown.

Megaworld is also constructing a three-level lifestyle mall, to be called Plaza Magellan, in the  township.

The mall will have an entrance plaza facing the landmark Lapu-Lapu Shrine.“The mall’s design will be inspired by the hilltop towns of Portugal and Spain. The architecture will feature courtyards and arcaded walkways, ornately framed doors and windows as well as cupolas and towers,” Megaworld said.

Aside from the mall and the hotels, the company is also building the Hawkers’ Gazebo, a covered food strip similar to the famous hawkers of Singapore.

This will be strategically situated near the main entrance of the township. “We envision The Mactan Newtown to serve as a major tourism hub of Cebu. The township is designed to be tourist-friendly, and our various offerings will also cater to the needs of the visitors of the island,” Hernandez said.

Megaworld is allocating P30 billion to develop the Newtown project in the next five to seven years. The development has 10 luxury residential condominium towers in the pipeline. Two office towers have been built and Megaworld plans to add at least five more office towers by 2020.

Upon full development, there will be around 150,000 square meters in office spaces that can accommodate an estimated 45,000 workers in the information technology-business-process outsourcing sector.

By 2016 Megaworld is also opening the Newtown School of Excellence, an institution that will be supervised by the Lasallian Schools Supervision Office.

S&P upgrades PHL rating to ‘BBB’

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08 May 2014

 

Written by Cai U. Ordinario

A year after the Philippines received its first investment-grade rating from an international credit-rating agency, Standard & Poor’s (S&P) Ratings Services awarded the country another credit-rating upgrade on Thursday.

With the latest upgrade, the Philippines’s credit rating is now “BBB” with a stable outlook. This was a notch higher than an earlier rating of triple-B minus or “BBB-”, which the country received in May 2013.

S&P said it upgraded the credit stature of the Philippines on the basis of confidence on reforms undertaken under the Aquino administration that will likely be preserved by the next administration.  “We raised the ratings because we now believe the ongoing reforms to address shortcomings in structural, administrative, institutional and governance areas will endure beyond the current administration,” S&P said. 

“Even though a change of administration after the presidential elections in 2016 represents some uncertainty for reforms, the risks have shifted toward maintaining the impetus and direction of the process, away from a potential reversal or abandonment of advances achieved to date,” it added.

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S&P said that apart from raising the long-term sovereign credit rating of the country, it also upgraded its short-term rating to “A-2” from “A-3” with a stable outlook. The credit-rating agency also said it raised its Asean regional scale rating to “axA/axA-2”, from “axA-/axA-2” as well as the transfer and convertibility assessment to “BBB+” from “BBB”.

Bangko Central ng Pilipinas (BSP) Governor Amando M. Tetangco Jr. welcomed the latest action by S&P, saying that this was an affirmation of the country’s strong macroeconomic fundamentals and overall economic resilience.  “The BSP welcomes the decision of S&P to upgrade the Philipines’s long-term sovereign credit rating by one notch, from “BBB-” to “BBB”. This is a major feat as S&P did a straight upgrade. They no longer assigned a positive outlook before upgrading the rating,” Tetangco said.  “Since S&P raised the Philippines’s credit rating to investment grade in May 2013, the Philippines proved that it is able to sustain high economic growth despite external volatility and, in the case of last year, successive domestic natural disasters,” he added. However, S&P acknowledged that the country’s low-income level will remain a key constraint to further improving its credit rating.

Megaworld to gain control of Global-Estate Resorts

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09 May 2014

 

Written by Vg Cabuag

Real-estate developer Megaworld Corp. is set to acquire the majority stake in Global-Estate Resorts Inc. (Geri), the upscale leisure developer, to put all of Andrew Tan’s property assets under one roof although, they will continue to operate as separate units.

Megaworld said in a regulatory filing, it agreed to purchase 49.2 percent of Geri from the company’s parent Alliance Global Group Inc. for a total consideration of P10.43 billion.

The company bought Geri for P1.93 per share, which was based on its 30-day volume weighted average price as of April 30.

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“The price is supported by a fairness opinion-and-valuation report issued by Navarro Amper and Co. [Deloitte],” the company said in a statement.

After the transaction pushes through, Megaworld will own 74.96 percent of Geri. The company will then initiate a mandatory tender offer to acquire the balance of the shares.

According to the Philippine Stock Exchange, Geri is still 8.81-percent owned by Fil-Estate Realty Associates Inc., with the rest owned by the general public.

“The acquisition is set to complete the consolidation of all the real-estate businesses of AGI under the Megaworld brand, enabling the company to capitalize on real-estate opportunities and to capture the expected growth momentum of its real-estate affiliates,” the company said.

Unlike other property firms that merged its assets into one big company, Megaworld simply wanted to put under one roof Andrew Tan’s property development assets although they will continue to operate as separate units.

The companies include Empire East Land Holdings Inc. and Suntrust Properties Inc., each with its own management team.

Megaworld owns all of Suntrust and 82 percent of Empire East.

“The consolidation will also increase our land bank all over the Philippines to more than 3,900 hectares,” Megaworld’s Francisco Canuto, chief finance officer, said.

GERI was behind the development of so-called tourism estates as the 150-hectare Boracay Newcoast on Boracay Island, the 1,149-hectare Twin Lakes project in Tagaytay, the 170-hectare Sta. Barbara Heights in Iloilo and the 561-hectare Southwoods City straddling the boundary of Carmona, Cavite and Biñan, Laguna.

Megaworld is known for its township project developments across the Philippines.

JLL outlook

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Category: Properties

06 May 2014

 

Written by Rizal Raoul Reyes

ALTHOUGH 2014 is the Year of the Horse, the Philippines property sector cannot achieve a galloping pace brought about by several factors.

“For me, the Philippines property sector is still on a jogging pace because it needs several reforms to stimulate the sector and attract more investors just like its neighboring countries,” said David Leechiu, country head of JLL Philippines, in a recent media interview held in Makati city.

Leechiu said the provision of the Constitution limiting foreign investors to 40-percent ownership in investments hinders the growth of the property and other sectors as well. He stressed that legislators should seriously look into amending the economic provisions of the Constitution to boost investment and capital in the country. Further, he said reforms must be pursued in joint ventures, property tax, capital gains and other important economic activities.

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“I wish we can do more reforms to grow further,” Leechiu said. Assuming that the Philippines achieves a stable fiscal position and good credit rating, Leechiu said the property sector will have to create additional office space from 20,000 to 100,000 square meters from non-business-process outsourcing and traditional offices.

Office space leased totaled 365,000 sq m as of end-2012, while a total of 117,000 sq m were pre-committed also in the same period. Total committed space was 482,000 sq m.

In 2013 a total of 470,750 sq m were committed with 185,520 sq m leased as of end-2013, while 285,230 sq m were pre-committed.

Leechiu said, “The business-process outsourcing [BPO] sector continues to be a major growth driver, particularly in employment, with a total full-time employees of 960,000 in 2013.” He noted that the government is on target of hitting the 1-million mark in employment in the BPO sector in 2016. “We think the country can hit as high as 1.3 million workers in 2016.”

A lion’s share, or 75 percent, of the information communications technology-BPO is concentrated in the National Capital Region (NCR). In the Central Visayas region, 6 percent of the jobs are based in Cebu.

The top BPO locations in Metro Manila are Makati  City (355), Quezon City (198), Fort Bonifacio (191), Ortigas (70) and Mandaluyong City (85). The government aims to generate $25 billion in revenues in 2016.

In the high-end condominium projects, JLL reported that the premier developers developed a total 3,322 units, with the majority of them achieving high volume of sales.

Further, the market for high-end and midrange developments also showed robust growth as indicated by the increase in demand. From the existing period (1995-2013), a total of 3,930 units were put up. The
demand continued to rise to 6,790 units in the 2014-to-2019 period.

Leechiu said the Philippine retail sector is also benefiting from the country’s economic growth as shown by the continuous development of malls not only within and outside Metro Manila.

Although the country’s tourism industry continues to attract large number of foreign visitors, Leechiu stressed there is a lot to be done to make the country one of the top destinations in the region. “In 2012 the Philippines received 1.8 percent of the total arrivals in Asia Pacific.”

In Asia and the Pacific Tourism Overview 2012, the Philippines, with 4,273 tourist arrivals, emerged 12th among 15 countries as the top destinations in the Asia-Pacific region. Topping the list were China (57,725); Malaysia (25,033); Hong Kong (23,770); Thailand (22,354);  and Macao (13,557).

However, Leechiu said the country showed remarkable improvement in 2013, when it emerged fourth with 19.6-percent growth in international tourism receipts and an 11-percent growth in international tourism arrivals. The Top
3 were Thailand, Japan and Hong Kong.

The tourism department reported that 3.8 million foreign nationals arrived in the Philippines from January to October 2013. However, the bigger picture indicated that the Philippines has a lot of catching up to do in terms of attracting foreign investment. In 2012 the country only managed to attract $2.8 billion in foreign capital—much lower than Indonesia ($19.8 billion); Thailand ($8.6 billion); and Vietnam ($8.4 billion).

“We can’t develop the country overnight. But we have to make the right policies and regulations to attract more investors in the country,” he pointed out.

CBRE: Growth to continue in 2014

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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).

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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.

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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)