Real estate outlook remains rosy in 2013 CBRE
The Philippine Star
07 Dec 2012
MANILA, Philippines – Leading real estate advisory firm CBRE Philippines shared in their recent briefing that the Philippine real estate sector shows no signs of slowdown and a positive outlook will still be seen in 2013.
“We are now experiencing the best real estate market in the last 20 years. It took two decades to get the stars aligned, but now, we’re looking at sustained growth and success. The challenge is how to cope with this unprecedented success. Suffice it to say that If you build it, they will come – be it office, residential, or leisure properties,” Rick Santos, CBRE chairman and founder, said.
In the office/commercial sector, CBRE said the country is in a unique position in Southeast Asia. Santos said the phenomenal growth of the BPO sector is akin to India’s experience in the early 90s. The Philippines is one of the top BPO providers in the world, surpassing India in voice operations and coming in second in non-voice operations. Santos mentioned that there is a lot of room for expansion in other areas such as software and web/graphics development, information technology and engineering services, and healthcare BPO. BPO revenues are expected to grow by 10-15 percent in 2016 (source: BPAP).
Santos adds that “the Philippines is one of the most cost effective outsourcing destinations in Asia, providing conducive environment for foreign investors through its excellent pool of skilled labor and customer service, one of the cheapest rents, and highest yields in Asia. The Philippines is becoming the lifeboat for many European and US companies that need to outsource in order to survive and preserve jobs in their homeland.” This is evident from global banks that are now relocating in the country for back office support. “We are a multinational player without leaving our shores. Manila is the gateway of the world – we are running the world’s businesses out of Manila.”
Multiple credit rating upgrades, the support of the government, and positive outlook are encouraging more businesses to expand and relocate in the country creating demand in luxury destinations and leisure properties.
However, while demand for the high end market will be sustained in 2013, developers will focus more on mid-income residential market segment within the P45,000 to P80,000 psqm range, reflecting the demand created from the growing population of families and young professionals and supported by the record-low interest rates. The Philippines has the lowest interest rates and best financing schemes for home ownership today.