III.

Industry analysis
Real estate
Land and anything fixed, immovable, or permanently attached to it
such as appurtenances, buildings, fences, fixtures, improvements, roads,
shrubs and trees (but not growing crops), sewers, structures, utility systems,
and walls. Title to real estate normally includes title to air rights, mineral
rights, and surface rights which can be bought, leased, sold, or transferred
together or separately. Also called real property or realty. Real estate is
simply the land and any improvements on it. Renters and leaseholders may
have rights to inhabit land or buildings that are considered a part of their
personal estate but are not considered real estate.
What can we expect from the real estate industry in 2015

2014 will end on a high note for the countrys real estate industry and it
seems that the consistent upward trend will go on to 2015. Property
developers and analysts have kept a positive outlook and foresee that the
year to come will be another exciting one for the real estate industry. The
ASEAN integration, the investment upgrade, and the swelling demand from
BPOs and OFWs are considered major factors in strengthening and buoying
the
real
estate
market
in
the
coming
year.
Office Real Estate

The country is already a relatively attractive investment choice due to

low rental rates compared to our neighbors in Asia, but new and old CBDs
(central business districts) will get a significant boost because of the recently
achieved investment upgrade. This recognition gives confidence to
multinational corporations who are looking to invest and branching out in the
country. BPOs in particular, are filling up office spaces the most.
It is also expected that the ASEAN integration will do wonders for the office

real estate sector, as corporations from countries such as Hong Kong and
Singapore will be branching out to the Philippines. The main challenge for
the office market next year would be how to keep up with the demand when
more international and ASEAN companies begin seeking properties in the
country.
For 2015, a fresh batch of supply is being developed and a significant
number of units will be turned over within the year. As of the end of 2014,
there are already several corporate plazas and buildings that are either preselling or are ready for turnovers in Ortigas, Makati and Taguig. Business
hubs are also being developed in areas outside Metro Manila. These business
hubs are vital in spreading the economic growth throughout the country.
Palayan City, for instance, is slated to become the next business hub in
Central Luzon. The newly inaugurated hub in Nueva Ecija will cost P1.5 B to
develop
and
will
generate
13,000
jobs.
Commercial Real Estate

This year, the kings of malls, SM, Ayala, and Robinsons have
continuously upped the ante by expanding and updgrading many of their
already world-class malls. More international brands are finding their way in
the country and the most notable international brand expansion this year is
H&Ms opening in malls late 2014. Much like the office real estate sector, the
ASEAN integration will rake in more brands that will invest and put up their
branches within the country, and no doubt will the three top conglomerates
be
able
to
accommodate
the
new
arrivals.
Other players are also planning to step up their game in 2015. In particular,
Puregold and Manny Villars Vistaland plan to invest billions of pesos to
expand their retail businesses. The former plans to invest 3.5 billion, while
the latter will be spending P15 billion in the next five years. When asked why
he decided to focus on retail, he said: I foresee exponential growth in
consumer spending with the rise of the middle class in the Philippines in the
next five to 10 years. Look at the phenomenon of affluent and expanding
middle-class spending in China, Thailand, Indonesia and India that is
happening here with our continued growth on OFW remittances, BPOs and
steady
economic
growth.

INVESTMENT REAL ESTATE

Unlike other investments, real estate is dramatically affected by the

condition of the immediate area where the property is located, hence the
well-known real-estate maxim, "location, location, location." With the
exception of a national or global recession, real estate values are affected
primarily by local factors such as the availability of jobs, crime rates, school
quality and property taxes.

Residential Real Estate

Though there have been talks of a property bubble looming in the

country, the issue seems to have passed for now due to the sky-rocketing
demand coming from low- to mid-income markets. Buyers from this bracket
are purchasing properties as end-users, not as investors. Driving this
demand are OFWs who are either planning to settle back in the country, or
are
purchasing
for
their
family
members.
In addition to the increasing demand which is keeping this sector buoyant,
the BSP recently announced that they will be releasing a housing price index
in
2015
to
prevent
the
property
market
from
overheating.
Real estate companies are also starting to focus on the outskirts of CBDs and
NCR (national capital region), with Cavite, Bulacan, and Laguna being
hotspots for new low- and mid-income homes. Many of these companies,
including those leading in the industry, have also pledged to close the gap
between housing demand and supply. By 2016, the SHDA (Subdivision
Housing Development Association) plans to reach 1 million houses. Currently,
the housing backlog has reached 3.9 millionand it is projected to reach 5.6
million
by
2030.
More townships will also be in development in 2015. Real estate giants
Megaworld and Ayala are already working on their own large-scale projects
that will build communities complete with business/office and commercial
areas for residents. Altaraza, Arca South, and Uptown Bonifacio are just some
of
these
emerging
townships.

Possible Threats

With the year ending on a positive note, we can expect the real estate
industry to be more robust in 2015. However, there are still existing possible
threats that could hinder the potential growth of the sector. Last week, there
was mention of how the increasing congestion and traffic in Metro Manila is
stifling the growth of the economy and the real estate industry, and that the
government must act quickly to improve the countrys infrastructure.
Real estate analyst Urban Land Institute, in its Emerging Trends Asia Pacific
2015 report, ranked the country back to eighth place both in development
and investment. Previously, the Philippines was ranked fourth place in
investment, and eighth in development. The drop in rank is due to issues in
government transparency and policies regarding foreign ownership in land.
The
report
also
cited
poor
infrastructure.
Also, while the bubble is said to be non-existent, the BSP must be prepared
to create policies that can be implemented immediately and effectively once
signs
of
the
market
overheating
appears.
If all goes well and as expected by property analysts, business may very well
be booming as usual in the country. However, it also seems that the
government will have a heavy role in securing that success next year. While
the BSP is ready to act should the market overheat, it is crucial that other
government departments in charge of transparency and infrastructure be
efficient in prepping the country. The players of the real estate field are ready
for year 2015 and for now, the ball is in the governments court.

Top 10 Philippine Real Estate Developers to

Watch Out for 2015
Posted on January 5, 2015

The booming Philippine property market is expected to continue its remarkable

growth in 2015. With this, old and new players in real estate development are
beginning to strategically position themselves to secure a firm standing in this
industry.
These developers are ranked based on their total market capital in the year 2014,
the number of successful flagship developments they have launched, and future
projects due for development in and outside Metro Manila. Here are the top names
in the Philippine real estate industry today.
Ayala Land, Inc. (ALI)
Known to be the countrys largest developer with market capitalization amounting
to $9.87 billion as of April 2014, the Ayala Land is the name behind some of the
biggest projects located in the countrys premiere business districts Makati and
Bonifacio Global City. These projects are The Residences at Greenbelt, One Roxas
Triangle, and One Serendra. Some of their up-coming projects are The Suites and
East Gallery to rise in BGC and Park Terraces, Garden Towers, and Two Roxas
Triangle in Makati.
Ayalas residential arm which composed of Ayala Land Premier, Alveo, Avida, Amaia,
and BelleVita continues to soar with an estimated Php240 billion in sales value.
Recently, ALI launched Alvierra, a 1,125 hectare development in Central Luzon. The
project will combine commercial spaces, business and industrial park, university
zones, retail centers, as well as residential and recreational areas.

SM Prime
Owned and spearheaded by the countrys richest man alive, SM Prime continues to
make its mark on the real estate business with market cap has reaching $9.554
billion on April 2014 only. Recently, they have initiated a development with mixed-

use project starting with the Mall of Asia. Upon its completion, the 6- hectare project
will combine residential buildings with BPO offices, two hotels, plus the shopping
mall.
Residential projects by SM Prime include Jazz Residences (Makati), Light Residences
(EDSA), Sun and Green residences (Manila) and Blue Residences (Quezon City).
They also operate 46 shopping malls and supermarket retail chains like SaveMore
and Hypermarket.
Megaworld Corporation
Megaworld has started projects with mix-use development where communities are
built. Their Eastwood City Township project features residential towers and malls
while McKinley and Forbes Town center caters to the high end market in BGC.
Another mix-use development they have is The Newport City which combines
residential spaces with hotels and entertainment hubs. As of April 2014, Megaworld
has an impressive $3.15 billion market cap.
Robinsons Land Corporation
Acknowledged as overall best managed company in the Philippines by Euromoneys
Best Managed and Governed Companies Asia Poll in 2013, Robinsons Land owns
and manages 32 malls, 32 residential subdivisions, 59 residential condominiums, 9
hotels, and 8 corporate buildings. With a market capitalization of $2.070 Billion as of
April 2014, Robinsons Land is led by Philippines 3rd richest man, John Gokongwei.
Filinvest Land
In 2014, Filinvest has allotted a total of P7 Billion to recreate the Festival Mall. Aside
from that, Filinvest has started work on more residential projects such as the
Entrata Urban Complex, The Levels, Studio City, and the upscale One Spatial in
Pasig City. Filinvestcontinues to develop residential properties in the provinces of
Cavite, Batangas, and Bulacan. Other notable projects of Filinvest include Beaufort,
Vinia Residences, and Linear Makati.

Century Properties Group

Century properties has been in the industry for 28 years providing state-of-the-art
commercial and residential properties. Their projects includes: Essensa East Forbes,
an ultra-luxury development located in Taguig. Century City, a 3.4 hectare flagship
master planned development situated in Kalayaan Avenue, Makati City. The
Gramercy Residences, a high-profile residential structure in Makati City. The
Knightsbridge Residences famous for its 8-Levels floor to ceiling lantern type glass
windows and white gold Bisazza tiles for its pool area.
Other upcoming high-end projects for Century are Century Spire which will be
partnered with top New York Architect Daniel Libeskind and Giorgio Armani/Casa,
The Milano Residences with interior design to be provided by Versace Home, and
their newest project outside Manila, The Resort Residences at Azure North in San
Fernando, Pampanga.
Rockwell Land Inc.
The Lopez Group of Companies established Rockwell Land Incorporated in 1995 and
since then, it has made its way to be one of the countrys top real estate firms. In
2012, Rockwell Land has reached a favorable P1.1 Billion in profits. Rockwell Center
in Makati, a 15.5 hectare of growing high-end community is their flagship project. In
2014, the group opened its Lopez Tower and Museum offering 20 floors of office
spaces for lease.
Other upcoming projects for Rockwell Land Incorporated are Proscenium, a project
to be led by renowned Uruguayan architect Carlos Ott. The Grove is an ongoing
project in Quezon City while Rockwell Business center caters to commercial market
and is situated in the Meralco Compound. They are also venturing into low-rise
development with their Project 205 Santolan.
DMCI Homes
DMCIs portfolio of properties includes 53 residential projects including the Acacia
Estates in Taguig. They are currently on the process of completing One Castilla
Place, Sorrel Residences, and Torre de Manila, a resort-inspired, high rise exclusive
residential community rising in Taft Avenue, Manila. In 2011 and 2012, DCMI has
sold about 15,000 unit totaling to P34.3 billion. They anticipate to turn over more
completed properties from this year up to 2018.

Federal Land
Previously known as Federal Homes, the first project developed under their wings is
the Soler Tower in Binondo. In 2002, Federal Homes was renamed as Federal Land
Incorporated. To date their project condominiums are Tropicana Garden City in
Marikina, Paseo de Roces, Oriental Garden, and The Oriental Place in Makati City.
Federal Land is currently in partnership with Japans Orix Corporation and is set to
develop the first Hyatt residences in the Philippines. The project will rise in Bonifacio
Global City.

Shang Properties
Bringing the largest and one of the most luxurious hotels in the country is Shang
Properties. Scheduled to open this year, Shangri-La at the Fort is a 500 plus room 5star hotel and high end condominium. Estimated to be at 250 meters tall, ShangriLa at the Fort will become one of the tallest buildings in the country. In addition to
this, Shang Salcedo and One Shangri-La Place are also expected to be completed
soon. Shang Properties is a merger between Kuok Philippines Properties Inc., and
Edsa

Properties

Holdings

Inc.