Smaller property developers must start landbanking in areas outside of Metro Manila in order to benefit from the Duterte administration’s focus on infrastructure development, real estate consultancy firm Colliers International Philippines said.
In a press briefing late last week, Colliers Philippines research manager Joey Roi Bondoc said smaller developers should follow the major developers’ footsteps in terms of landbanking.
“Smaller developers need to play catch up so that they could maximize the infrastructure projects in the pipeline,” Bondoc said.
Bondoc noted that once the ongoing infrastructure developments have been completed, more township developments from the big players would start to come out.
“The major developers have significant portions of land in those provinces and you can really tell that they are just waiting for these infrastructure projects to be developed and once these projects are completed, expect more township developments that will be developed by these major players,” Bondoc said.
In a report by Colliers Philipines entitled “Planes, Trains and Automobiles: The Impact of the Government’s Infrastructure Policy on Real Estate” Colliers said that the infrastructure plans of the current administration would dictate the direction of real estate developments beyond its term.
“To improve the quality of infrastructure in the country, President Duterte ordered the streamlining of the approval process for infrastructure projects, particularly those under the public-private-partnership (PPP) scheme, and ramping up infrastructure spending equivalent to about 5 percent to 6 percent of the country’s Gross Domestic Product (GDP),” the report said.
In line with landbanking, Colliers is urging major developers to revisit their landbanking and construction efforts in Davao City, driven by the focus on the area.
“With the shift of the political center of gravity to Davao City, we expect the infrastructure developments in Mindanao will be pursued with more vigor,” Colliers said.
Similar to the township development trend, Bondoc noted that developers would make use of the mixed-use development trend.
“We expect developers to develop more townships because they offer better value,” Bondoc said.
Bondoc noted that developers should also venture into the development of MICE (Meetings, Incentives, Conventions, and Expositions) facilities and leisure developments as the improvement of infrastructure particularly airports in the Visayas and Mindanao area will attract more local and foreign tourists.
“Developers should pursue MICE facilities outside of Metro Manila with sufficient space for functions and meeting places,” Bondoc said.
Furthermore, Colliers said that improved infrastructure facilities might also result in the expansion of alternative industrial hubs in locations apart from the popular Cavite, Laguna, and Batangas area.
Some likely alternative industrial locations are Bataan, Bulacan, Tarlac, Pangasinan, La Union, Cebu and Davao.
“The resurgence of the country’s manufacturing sector coupled with the improved infrastructure connectivity brought by the railways and expanded highways should enable the country to attract more investments,” Colliers concluded.