Priming premium condominium developments
Amid rising vacancies in Metro Manila’s secondary market for affordable and mid-income housing, Colliers Philippines expects demand for luxury units to remain strong.
This resilience is driven primarily by the influx of expatriates and international visitors, alongside sustained interest from affluent families seeking residences both to live and to invest in.
A strong case for premium condos
Some affluent empty nesters are increasingly choosing vertical developments near their existing homes—opting for condominium units in integrated communities where basic necessities are just steps away.
Business executives and diplomats meanwhile also prize these high-end properties not only for their meticulous upkeep but also for the hotel-style amenities and premium concierge services.
In the leasing market, these projects continue to command high rents due to the convenience, accessibility, and exclusivity they provide.
Overall, these premium residential condominiums entice both end-users and investors due to their proximity to the bustling business districts. Aside from providing tight, round-the-clock security, these properties also offer well-equipped gyms, resort-like pools, ample parking space, quality interiors, among others.
These high-end residences often sit just a stone’s throw from major shopping hubs, offering a mix of local and international brands tailored to residents’ discerning preferences.
Greater emphasis on sustainability
Note that these upscale, luxury, and ultra luxury condominium units usually offer larger and greener spaces.
In our briefing polls, sustainability ranks high among investors’ totem pole of priorities when acquiring properties. Colliers Philippines believes that this will likely be the norm moving forward.
While the sustainability trend now focuses on workspaces and office buildings, Colliers believes that in the near term, more developers will integrate healthy and sustainable features into their condominium projects within and outside Metro Manila.
Bustling demand from expats
What’s interesting is that post-pandemic, Colliers has seen an aggressive take-up of office space from large business process outsourcing (BPO) companies and multinational firms.
Over the past few quarters, we have seen more foreign firms occupying office space in key business districts including Makati central business district (CBD), Fort Bonifacio, and Ortigas Center. The foreign employees of these companies will eventually require residences, which should drive the demand for bigger and more spacious condominium units.
Proximity to institutional facilities
A key feature of luxury and ultra luxury condominium projects is their proximity to support facilities such as hospitals, clinics, and schools, including international ones.
Colliers believes that this feature alone makes the expensive condominium developments as among the most desired in the metro. The convenience brought about by the proximity of vertical residential units to institutional facilities will become more popular moving forward especially with the rising viability of mini or micro townships across Metro Manila.
Awash with cash
It is important to highlight that Metro Manila’s luxury and ultra luxury condo markets remain robust, drawing affluent buyers awash with cash. Luxury units start at P20 million, while ultra luxury residences command prices of P100 million and up per unit.
Popularity of luxury JV projects
One of our recommendations for national developers is to explore opportunities and partnerships with foreign developers.
In our view, these joint ventures (JVs) should help local players differentiate their projects in the market. These joint venture projects either between Philippine firms or between local and foreign developers are among the more expensive projects in the market but remain popular among Filipino and foreign buyers.
To take advantage of market dynamics, developers should emphasize the JV projects’ upscale amenities, integrated development features, proximity to infrastructure and parks, and strong potential for capital appreciation.
At Colliers, we have seen national developers taking the JV route as they aim to push their pre-selling residential prices higher amid a precarious Metro Manila market. These partnerships should be beneficial to property firms with limited landbank as well as to those that intend to offer luxury to ultra-luxury residential projects.
For feedback, please email joey.bondoc@colliers.com
