• REAL ESTATE

    Infra projects to buoy township devt

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    TOWNSHIP developments in the Philippines are predicted to accelerate in the medium to long term, bolstered by the ruling administration’s vision to usher in the golden age of infrastructure under the “Build, Build, Build” program.

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    Joey Bondoc, research manager of the Colliers International-Philippines, said more townships would rise in Metro Manila, particularly in key areas where infrastructure projects are being developed. “At least for the next five years, the Duterte administration, all it wants to do is build, build, build…,” he told The Manila Times. “So, definitely, for Metro Manila, we will see more township developments.”

    “We’re seeing those in Fort Bonifacio, which are relatively smaller, and some in previous sites that were originally developed as industrial locations, especially along C5,” Bondoc said. “Now they have been transformed into integrated communities—township developments—and these are by Megaworld and Robinsons Land.”

    A township is also referred to as mixed-use developments or integrated communities, where developers construct usually 10 or more properties of several types including office buildings, condominiums, malls, retail spaces and transport hubs.

    International consultancy Pronove Tai Property Consultants shared the same view, saying the government’s increased spending in infrastructure would benefit the real estate landscape. “These infrastructure developments are a key medium to decongest Metro Manila,” it stressed. “Then, the ‘Build, Build, Build’ program will improve railways, expressways, airports, and bridges, making Metro Manila more connected and accessible to the outskirts of Calabarzon [Cavite, Laguna, Batangas, Rizal, Quezon], Central Luzon, and even up north of Luzon.”

    It added that by 2040 and with the intensified infrastructure in place, township developments would further grow in number, particularly outside of Metro Manila. Should a trend in developments and land acquisitions continue, the country will be seeing massive improvements towards decongesting Metro Manila as businesses locate or relocate to the countryside.

    “The township’s upside is more on the increasing business presence around the country, and not merely centralized within Metro Manila,” Pronove Tai said. To date, some of the notable companies that have ventured into mixed-use projects include Megaworld Corp., Ayala Land, Inc. (ALI), Robinsons Land Corp., Filinvest Land, Inc., Vista Land and Lifescapes, Inc., and Profriends, Inc.

    “What we’re seeing are these township communities being developed almost beside every infrastructure project,” Bondoc said. He cited, for instance, the Vertis North project in Quezon City by ALI, which is now nearing completion. The project is near the Metro Rail Transit-3 (MRT-3) and the upcoming MRT-7, while the ARCA South, also developed by ALI is near the planned South Integrated Terminal.

    Provincial landbanks
    Colliers, a global provider of management services to real-estate investors, is forecasting tight land bank supply in the metropolitan area by 2040, which will push property developers to expand to rural areas. Already, several firms have constructed projects near the metropolis as in Cavite, Batangas, Laguna, Pampanga, and Bulacan.

    “By 2040, there will really be a tight supply of land available within Metro Manila. [W]hat we’re seeing is, really, is they will expand outside Metro Manila, so [there will be]more aggressive expansion because that’s where the developable land is available,” Bondoc said.

    Megaworld offers Capital Towns, in San Fernando while ALI has Alviera in Porac. Filinvest will construct Mimosa Estate in the Clark Green City. In Bulacan, ALI has Altaraza in San Jose Del Monte. “If you extend farther, a portion of Clark Green City already covers Tarlac, so Tarlac will become a very viable hub for township development and Pangasinan as well,” Bondoc said.

    In Southern Luzon, Megaworld is completing Southwoods City, situated along the borders of Cavite and Laguna. Vista Land, meanwhile, has Vista City, in Bacoor, Cavite, while Profriends is offering Lancaster City, in Imus, also in Cavite. Such projects are close to the Light Rail Transit-1 (LRT-1) extension, Cavite Extension-C5 South Link, LRT-6, North Luzon Expressway-South Luzon Expressway (NLEX-SLEX) Connector Road and the Sangley Airport.

    “Southern Luzon was really where the townships were first developed because it experienced a huge … improvement in terms of township development,” Bondoc said. “But what we’re seeing is that the Northern and Central Luzon are catching up.”

    Outside of Mega Manila, Colliers said it was seeing more opportunities in Cebu, Davao, Iloilo, Naga and Negros Occidental. “For townships, there has to be a critical mass,” it emphasized. [In Cebu, there are] a lot of people there. Also those are the areas where you have a skilled labor pool, so you really have to have these features for such locations.”

    Significant to PH economy
    Colliers said the construction of more township projects would translated to higher job opportunities. “[Townships are] significant because when you start the construction, you start to hire people,” Bondoc said. “That will … drive the demand for retail because it expands the consumer base, it employs a lot of people. So when they are earning money, therefore, they have this greater ability to consume or to pay for goods.”

    He also said that once the office buildings were built, companies engaged in outsourcing would come in and hire. “This, of course, helps improve employment in the Philippines,” he stressed.

    Pronove Tai, meanwhile, said the Philippine working force was dominated by a young population, 44 percent of whom are between 22 and 32 years old—the age range for those being employed in the BPO sector. “Majority of employees in the BPO and offshore gaming are millennials, considered as the top consumers in any township retail developments,” it added.

    Township developments, therefore, will be more feasible in propelling the economy owing to such factors as more office take-up and investors wanting a “live-work-play” environment. The residential aspect will also entice working professionals to live within the vicinity of their offices to beat traffic.

    “[T]ownship developments offer a one-stop approach to accommodate the number of professionals, making moving from work to residence more accessible within the master-planned communities,” Pronove Tai said. Not only will a mixed-use development save time and increase productivity for residents, it will also increase consumer spending as retailers are within reach.

    Since the new administration took office last year, there has been an estimated P7.1 billion of investments by companies that wanted to locate their operations in township developments, according to data from the Philippine Economic Zone Authority.

    On the tourism side, the integration of hotels and restaurants will increase the arrivals of both local and foreign visitors, said Colliers. “If you have these—for example—in some CBDs [central business districts], the capital appreciation results in the compression of yields,” it added. “But if you, for instance, acquire a new condominium unit in a new township in the fringes, the entry level price point is much lower compared to price points in the established CBDs. So there’s really this potential for further yield enhancements.”

    Compared to stand-alone properties, township developments, Bondoc said, are better projects as these offer a wide array of activity areas under the“live-work-play-shop” lifestyle concept. “They no longer have to commute from, say, Quezon City to Makati,” he added. “If you live within an integrated community, then that would be good for you.”

    What are lacking?
    Most mixed-use properties have common features, according to Colliers, citing condominiums, offices, and malls. But what they mostly lack, Bondoc said, are hospitals, schools, and entertainment facilities. “For townships outside of Metro Manila, it will really be feasible to have industrial space because industrial facilities house manufacturing companies,” he added. “And these manufacturing companies provide jobs to people within the township and to those outside of that township.” Industrial activities, in other words, will help sustain the economic viability of master-planned communities.

    Pronove Tai said other key components and areas that had yet to be explored include tourism (or the accessibility to weekend getaways), coastline villages and connectivity. “Developers should always consider the concept of a ‘walkable city’ by increasing the number of pedestrian lanes and walkway shed for protection from the sun and rain,” it noted. “Moreover, we are seeing a shift on the perspective of creating green cities, so we might also consider designating ‘bike lanes’ within the community development.”

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