Real estate outlook remains rosy in 2013 CBRE

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The Philippine Star

07 Dec 2012

http://www.philstar.com/business/2012/12/07/881979/real-estate-outlook-remains-rosy-2013-–-cbre

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.”

In the residential front, the country will also experience increased real demand across all market segments, spurred in large part by the BPO sector.

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.

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Yesterday , we concluded the handover of our unit located on the 27/F of Philamlife Tower. It was a relief that we finally have access and can proceed with our minor refurbishments. Finally an official announcement can be given to our Engineers who really deserve a better facility that they can call their own.

Much of this good news and feelings of self-achievements of getting this unit would not be possible without your help and that of you most gallant employees, Mr. Francis Bautista and Mr. Philipp Llave.

Initially our head office in San Francisco was not in favor to get our own unit and moving out of Regus because of the initial capital outlay it represented. Eventually we were granted approval to start the search on the condition that it would be a tail-end of an existing lease, with no capital outlay needed for fit-out, cabling and furniture on our part. Knowing what the real estate market in the Philippines is like and our prior experience in finding office space, the situation proved very challenging, if not frustrating for us.

But with their professionalism, persistence and unique knowledge of the market, Francis and Philipp were able to find us a unit that fit the specifications of our head and negotiate a deal that was beneficial to us. To sweeten the deal further, the space they provided is just a few floors away from our existing office thus making it an easier transition for us.

Bottom line, what I am trying to say is “THANK YOU” to both most especially to Francis who’s been very instrumental on all my needs in terms of office spaces.

Keep up the good work guys!

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