Property upside in the countryside

The recent PropertyGuru awards recognized not just the major national players but also the homegrown regional developers taking advantage of the thriving appetite for residential, leisure, and industrial developments outside Metro Manila.

A quick scan of the awardees would reveal that regional players were formidably placed alongside major developers with property footprints across the Philippines.

Well-positioned for an upswing

Philippine developers are taking advantage of the growing demand for the more expansive and expensive condominium segments, from P12 million up to more than P100 million per residential unit.

The common question we get from developers and investors is if the worst is now over for the Metro Manila condominium market. Hopefully. But developers shouldn’t be complacent. Property firms should continue to innovate and recalibrate. After all, there are opportunities amid uncertainties.

Expanding beyond MM

Developers today are constantly expanding their presence in thriving locations outside Metro Manila.

Cebu, in particular, remains an important location for property developers looking to expand their footprint and corner the growing demand from thriving upscale and luxury markets.

The province is now one of the most attractive and largest residential hubs outside Metro Manila. National developers continue to launch in Metro Cebu as they are optimistic of the locale’s potential for growth even beyond 2024. In our view, the improving sentiment from businesses, individual investors and end-users will likely support the growth of Cebu’s residential sector.

Premium residential market ex-NCR

One of the luxury projects in Cebu is Rockwell Land’s The Villas at Aruga, the most expensive project in Cebu so far on a per sqm basis. The project has an average total contract price (TCP) of P101.3 million and an average price per sqm of P589,600.

Meanwhile, Cebu Landmasters Inc. also launched its first premium residential project called The Wave, which will rise in Cebu IT Park. This means that developers such as CLI are proactively cornering the rising demand for more expensive residential developments in the Queen City of the South.

And there’s reason for this. Upscale and luxury condominium projects in Cebu are doing well. With prices ranging between P12 million and P101 million per unit, take-up ranges from 40 percent to 100 percent. Besides Rockwell, Ayala Land, Megaworld, RLC Residences, and Shang Properties are also offering these more expensive projects in Cebu.

Davao’s luxury market

Other markets seeing an upswing for the luxury market include Davao.

Such condominium projects here have prices ranging from P12 million and P34 million a unit, with take-up rates of between 74 percent and 100 percent. Residential developers are further testing the market and even diversifying to leisure-themed projects. Among the developers with upcoming leisure-oriented projects in Davao are Damosa Land (Bridgeport Park) and Torre Lorenzo (Dusit Thani Residence Davao and Crown Residences).

Upscale and luxury lot-only projects in Davao are also faring well. These residential lots are priced at P10,000 to P45,000 per sqm but are now 50 percent to 100 percent sold. Among the property firms offering this product type include Damosa Land and Sta. Lucia Realty.

Leisure: Locals bring in global

Colliers believes that now is also an opportune time for foreign brands to expand their presence in the Philippines given the planned modernization of the country’s international airports and the projected rise in international arrivals.

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The government has set a lofty goal of attracting 12 million international tourists in 2028. This optimism has been enticing foreign hotel operators to expand presence across the Philippines.

Sofitel Philippine Plaza Manila has officially closed its doors on July 1, 2024, but is expanding its presence in key destinations such as Cebu and Clark in Pampanga. Accor Hotels will be developing a 175-room Ibis Styles and 250-room Mercure Hotel in Subic, Zambales.

Radisson Hotels also announced that they will be launching Radisson Blu in Cagayan de Oro, as well as other Radisson brands in Cebu. Other foreign branded hotels in the pipeline will come from Sheraton, Dusit Thani, Citadines and Tryp by Wyndham.

Cebu Landmasters is one developer that is aggressively taking advantage of growing opportunities in the leisure sector, bringing in major foreign brands such as Citadines Sofitel, Mercure, and Radisson Red to popular hubs such as Cebu and Bacolod City.

It’s interesting to note that while homegrown hospitality brands continue to resonate with local and foreign visitors, more national players are aggressively bringing in international brands. These partnerships are no longer surprising given the Philippine tourism’s growth prospects and the promise of seamless connectivity.

To see national and regional players actively launching new residential and hotel projects is definitely a positive development for the property sector. This ensures a more diverse Philippine property market–one that is more than ready to seize opportunities and take an active role in fostering a more inclusive economic growth for the Philippines.