KMC Savills Managing Director Michael McCullough was one of the esteemed panelists in the recently concluded Pinnacle Holding Company's 1st Global Forum held in Sofitel Manila. McCullough is tasked to share the perspective of the Real Estate sector when it comes to the flagship project of the Department of Public Works and Highways called the "Build, Build, Build" program.
McCullough assured the attendees that the real estate sector is in its "sweet spot" for the next 5 to 10 years since the long-term prospects for the country are still very bright. He also discussed the effects of the new tax reform and how it may bring more money to the retail sector. As a result, KMC Savills expects that a lot more money will be thrown into residential projects due to the increased spending capacity of the public.
According to him, the demand for office spaces is still being driven by the Business Process Outsourcing sector.McCullough admitted that there were "freezes" encountered last year but the BPO sector is once again back on its normal footing.
KMC Savills also shared that the occupancy of office spaces outside Metro Manila is also picking up. The real estate sector now looks at Clark, Cebu, Iloilo, Bacolod, and Davao to contribute significantly to the office supply. This is also in line with the government's vision of decentralizing the development outside Metro Manila.
When asked about the infrastructure that will most likely benefit the real estate sector, McCullough expressed high hopes for the Metro Manila Subway project. He discussed how there are a lot of speculations about the location of the subway stations. He stated that key business districts such as Quezon City, Bonifacio Global City, and Ortigas should be prioritized in this project.
Also, in the same panel, Budget Secretary Benjamin Diokno discussed their new approach when it comes to the current and future infrastructure projects. They are implementing the "turnkey basis" wherein a project needs to be completed first before the issuance of a payment. To be more specific, Diokno also cited a "secret conversation" with President Rodrigo Duterte about the Clark International Airport being implemented under the said basis. He explained further, "we will pay them after it's done, 2 years from now. This will speed up the implementation."
Other panelists are First Metro Investment Chairman Francisco Sebastian, ING Philippines Country Manager Hans Sicat, NEDA Deputy Director General Rolando Tungpalan, Philippine Stock Exchange Ramon Monzon, and JICA Chief Representative Susumo Ito also discussed infrastructure funding, foreign investment, private-public partnerships and traffic management in the country. Beyond infrastructure, they also touched on the topic of improving the broadband connectivity in the Philippines as they anticipate the entry of a foreign telecommunications company.