What would be on the up-and-up the coming year? Inquirer
Property continues the fearless forecast of the real estate industry for 2012:
Ø Emerging trends will spring up from various
sources in 2012, fueled in great part by Internet marketing. Property analysts
also see pocket developments in new central business districts, while
competition will shift to the home-buying experience, which, says Enrique
Soriano, professor at the Ateneo Graduate School of Business and senior adviser
at Wong+Bernstein Business Advisory, would revolve around hybrid
residential-cum-leisure projects. Soriano adds that locations most likely to
“break out” and make themselves known would be Alabang, Laguna and Cebu.
Ø Condos will continue to lord it over in cities
and emerging growth centers. Condominiums in cities would gain on subdivisions
and related housing developments in 2012. Soriano says this particular asset
class will likely to be sustained in 2012. Aside from the NCR and Cebu,
specific locations in the country where condos would most likely to gain a
dominant foothold over housing would be emerging CBDs and regional growth
centers such as Davao, Iloilo, Bacolod and Cagayan De Oro. Top leisure
destinations would still be Boracay and Baguio.
Ø It would also be the office sector’s banner
year. Rick Santos, chair and CEO of CBRE Philippines, and Victor Asuncion,
executive director for Global Research & Consultancy, say expansion of
business process outsourcing companies, shared services, and call centers would
continue as economies tighten in the West (United States and Europe). They also
add the expansion of BPOs in the North (such as Clark and Subic); opening of
the first precertified LEED Gold for Core & Shell Building in Makati—The
Zuellig Building; and the synergistic relation of Bonifacio Global City and
Makati in the office sector in the next two years.
Ø More tourism-oriented developments to rise in
2012. Paul Vincent Chua, associate director for valuation and advisory services
and head of consultancy and research of Colliers International, says: “We will
see a lot more tourism-oriented developments as we strive to enhance the beauty
of the Philippines on the international scene and get more tourists to visit
us.”
Chua says major developers and
investors are now studying the impact of the country’s international presence
through improved marketing efforts of the Department of Tourism, and recently
the inclusion of Palawan’s Underground River as one of the Seven Wonders of
Nature would also showcase the Philippine’s other natural beauty.
Related to tourism would be the
gaming business, and as evidenced by the success of Resorts World, there would
be more such establishments, Chua foresees, once Pagcor’s Entertainment City
gives rise to more world-class hotels and casinos.
“What is critical now is how
the government will answer the growing concerns on the public-private
partnerships (PPPs), particularly in the infrastructure and transport sector,
which are equally important in tourism. We also need to rectify quickly the
concerns on our international airport, which is still rated as one of the worst
in the world. In a related issue would be the problem of international carriers
leaving the country as one of its hubs in Asia. This would mean additional costs
to both tourists and locals who are also traveling to other parts of the
world,” Chua says.
Ø Hotel and leisure sector will be dynamic in
2012. The expected growth in tourist arrivals, and with the advent of the
gaming sector in the country, growth in hotels and leisure establishments would
naturally follow, according to Santos and Asuncion.
CBRE observed that major
developments sprouting in the Bay Area such Pagcor City and Belle Grande Casino
Resorts Manila have added significantly more investments in the gaming
industry. The continued growth of the office sector has prompted new branded
hotel projects such as Shangri-La at Bomifacio Global City, the Grand Hyatt and
Fairmont Hotel.
Investments and developments in
serviced apartments have been spurred by the increase in medium-term staying
business travelers such as BPO (business process outsourcing) trainers and
consultants
Tourism to prosper in 2012
The expansion of the tourism
sector will also be seen in Cebu and the Visayas region as more residential and
office developments begin, driven primarily by the BPO expansion in the region.
The expansion of the
liberalized airline industry signals more foreign carriers to come in. Air
Asia, for example has provided cheaper alternatives for international travel to
local tourists.
The continued increase of
foreign tourist arrivals, coupled with growth in domestic tourists traveling
across the archipelago, has triggered new hotel developments in key tourist
destinations. This trend will continue in 2012, with certain prime locations to
enjoy more prominence, such as Boracay, Cebu, Davao, Cagayan de Oro, Palawan,
Clark and Subic.
Foreign investments into
medical facilities will also 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
returning retirees like balikbayans.
Ø Live-work-play projects will continually
prosper in Metro Manila and other expanding cities. Chua says there will be
more mixed-use developments as a key strategy for developers, as this will
maximize the returns on a large plot of land.
“This would mean a continued
focus on the live-work-play concept started by Megaworld, particularly in Metro
Manila and other highly urbanized cities. We also saw successful launches of
condominiums in Visayas and Mindanao by Ayala Land’s Avida, which will continue
in 2012. Related to mixed-use developments are retail developments. In Metro
Manila, we saw a lot of vertical developments with retail podiums on the ground
floor. However, since super regional and regional malls have about 99-percent
occupancy rate in Metro Manila, we will see more expansion geographically,”
Chua explains.
Ø CBRE Philippines also predicts the high-end
residential sector to become more popular in 2012.
Ø Growth of mid-income residential developments
in 2012. Santos and Asuncion observed that young urban dwellers and start-up
families have fueled the growth and expansion of middle-income vertical subdivision
developments (i.e. condominiums) across Metro Manila with concentration on the
peripheries of business districts. This trend would most likely continue in
2012.
Ø Continued demand in retail sector in 2012.
CBRE Philippines sees the following to continue in 2012:
Retail expansion for
neighborhood centers, supermarkets, hypermarkets and malls to continue across
the country with new retail developments from Ayala Land, SM Prime, Robinsons
Retail, Puregold Price Club, Rustan’s and Waltermart about to become
operational.
Increased expenditure for
dine-outs, or food consumed outside home, would fuel the expansion of fast-food
chains, retail kiosks as well as beverage shops such as coffee, milk tea and
frozen yoghurt.
More industrial and logistics
interests in the Philippines in 2012, as wages in China go up, and in the
aftermath of the Thailand floods. Such developments have caused more
manufacturing plants and facilities to relocate and open in the Philippines.
CBRE Philippines says these indicators in 2011 portend continued growth in
2012.
Tessa R. Salazar
Philippine Daily Inquirer
Business & Investment Opportunities
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