Land opportunities now shifting away from CBDs - property analysts

Business World Online by Daphne J. Magturo, 11-20-2014

AS land values in central business districts (CBD) continue to climb, demand is starting to spill over to their fringes, whose prices are also seen to eventually appreciate, property experts said on Thursday. 

"It's starting to happen already, and it is a natural occurrence for the CBDs to expand to their fringes. If you notice, we do not have a consolidated CBD in Metro Manila," Jose Carmelo Porciuncula, head of investments at KMC MAG Group, Inc. said by phone.

He said there are now "redevelopments" on the outskirts of Bonifacio Global City, Ortigas district and Makati City, including Pasong Tamo, Poblacion, Kapitolyo and Shaw. Particular projects include Circuit Makati and Century City.

"The general real estate appreciation in the country is 5-8% annually. However, the possible appreciation in the fringes will still be dictated by demand," he said.

John Corpus, director at CB Richard Ellis (CBRE) Philippines, Inc. said the outlook for the country's property sector remains positive, as the global manufacturing sector strengthens and industrial firms in China are now looking to transfer their manufacturing here.

"But the challenge is Metro Manila is not ideal because land is now expensive and there is limited supply," Mr. Corpus said during the Asia Pacific Real Estate Investment Summit in Taguig City.

He added that the "opportunity is now in the Calabarzon (Cavite, Laguna, Batangas, Rizal and Quezon) area."

CBRE data showed that land in Calabarzon costs around P4,000 to P6,000 per square meter every month, while those for industrial use, monthly land lease is from P50 to P80 per square meter, and P80 to P250 per square meter every month for standard factory building.