• Developers seek foreign buyers for student housing


    Builders shifting focus to investors, 2nd-property buyers, analysts says

    THE Philippines is aggressively pitching condominium and dormitory-type hou-sing for students to overseas investors, particular in Qatar and elsewhere in the Middle East, part of an effort among developers to “branch out” from the traditional end-user market, an analyst from real estate services firm Colliers International said.

    The Chairman of the Philippine Business Council-Qatar, Greg Loayon, has been actively promoting the Philippine real estate sector to Qatari and expat Filipino investors, particularly student housing.

    “The Philippine property market is resilient, growing at about 12 percent per year,” Loayan said. Qatari investors are looking at beach property and other tourism properties, but “Student accommodation is what I would actually offer. In terms of rentability, it is easy to find a tenant because demand in this area is very high, particularly for Filipino parents who are working abroad,” he explained.

    Foreign investors can benefit from the pattern of overseas Filipinos sending their children back to the Philippines for college studies, he continued, pointing out that investors from Singapore, Hong Kong, and China have been buying small condominium units to rent to students.

    “We’ve seen that happen with a lot of investors from Singapore, Hong Kong, and China but the Middle East is slowly waking up to owning properties in the Philippines,” Loayon explained.

    “In terms of rentability, demand in this area is very high, particularly for Filipino parents who are working abroad,” he added. “These condominiums are packed in a short period. “The experience is that within the first three months, these units are already occupied, giving investors immediate return of investments.”

    Developers ‘branching out’
    An analyst said that the pitch to Qatari investors coincides with an effort on the part of developers here in the Philippines to ‘branch out’ from the conventional market of sales to end-users of condominium units.

    “It’s part of a pattern we’re seeing with developers, branching out into niches such as student housing, or housing for workers,” said Julius Guevara, Director of Research and Advisory Services for property services firm Colliers International Philippines.

    Sales to traditional buyers—people buying condominiums for their own homes—are slowing, Guevara explained in a phone interview Tuesday.

    “Student housing is part of it, as well as second or part-time housing for workers,” who might spend most of the week near their jobs in the city, but maintain permanent homes in the nearby provinces, Guevara said.
    As for the recent promotion to investors in the Middle East, Guevara said that Colliers had not yet seen any particular trends developing. “This is the first we’ve heard of this move in particular, but we do see some foreign buying,” he said.

    However, the recent change in the education system to the K-to-12 program may present a challenge, Guevara added.

    “One thing that I think they’re going to run into is with the K-to-12 program, there will be fewer students entering college,” he explained. He cited the case of one developer who has recently put a student housing project along Manila’s Taft Avenue on hold, “because they really don’t know at this point whether they’ll have enough students to fill it,” he said.


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