Philippine real estate opportunities in a post-pandemic world: Why intelligent investors should act now

The Philippine economy is primed for an imminent recovery in 2021, offering unique opportunities for real estate investors whose needs have been reshaped by the pandemic. As the economy reopens and vaccination programs are rolled out, intelligent investors should look into developments that offer the greatest potential to grow in value.

This was the forecast of Sheila Lobien, Chief Executive Officer of the Lobien Realty Group, when she presented on “Philippine Real Estate Opportunities in the Post Pandemic World.”

Economic recovery prospects

Lobien noted that while the Philippine economy may be sensitive to political, natural, and global financial risks, it is nonetheless very resilient, as was seen during the Asian and Global Financial Crises, where the country bounced back in stronger form. The country’s 110-million strong population of young (average age 25), highly literate, and dynamic consumers, creates a demographic window that translates into a strong, robust market over the medium and long term. This, coupled with the government’s infrastructure projects, will serve as a growth engine and pave the way for a sustained recovery.

With various infrastructure projects underway despite the pandemic, and completion dates within sight, an appreciation in land values is certain.

Sustained land value appreciation

In fact, despite the economic slowdown, land values have continued to climb across Metro Manila, including in Makati, Taguig, Pasig, Mandaluyong, Quezon City, and Alabang. For Lobien, this should serve as an indication of how land values could further appreciate once the economy picks up. Emerging business hubs, such as those along growth corridors, could stand to appreciate the most, and offer enormous opportunities for those looking at a 10-15-year horizon.

One compelling reason to invest at this time, said Lobien, is that property prices, especially in the new growth centers such as Pasig and Quezon City, have not yet skyrocketed, thereby offering good upside potential. Second is the availability of credit from financial institutions, many of whom have become less stringent with their terms. For investors, this is a buying opportunity that seldom comes up.

Solid demand for office, residential spaces

Even as the Covid-19 pandemic persists, growth in the office space sector is inevitable. Despite expectations to the contrary, demand has stayed strong in 2020. Office space demand is still largely driven by BPOs, which could only grow stronger as global firms turn to outsourcing as a way to manage costs amid the global economic slowdown. In fact, the Philippine outsourcing industry is expected to account for 22% of the global outsourcing market in 2022 and is forecast to grow by 9% every 5 years. Interestingly, while bulk of the current BPO seats are still in Makati, the combined seats in Pasig and Quezon City surpass Makati’s in number, showing the dynamism of these areas.

The residential market also bucked expectations in 2020, with demand exceeding supply as intelligent investors saw a golden buying window during the pandemic. Take-up of pre-selling units were particularly strong in the P7-15 million and above P15 million ranges. This, noted Lobien, mirrors how the pandemic has reshaped the market’s requirements, with discerning investors opting for features that are found in high-quality properties.

Post-pandemic investor preferences

For instance, intelligent investors are showing a strong preference for micro cities, with proximity of one’s residence to the office becoming highly valued following the pandemic. Lobien foresees increased demand for condominiums in central business districts and mixed used developments within Metro Manila. She also foresees a jump in demand for affordable single detached homes with sufficient space outside CBDs, as more Filipinos work or study from home. All these will translate to an appreciation in property values, which will be highest for properties with the optimum potential for growth.

Function has also emerged as an important consideration, with investors seeing condos as homes, halfway homes, and an investment for rent. Having units with the right cuts, open spaces, good ventilation, natural lighting, and right density are therefore very important. Investments in good filtration systems for enclosed common spaces are needed, said Lobien.

Most importantly, a good location matters. Proximity to the international airport, transportation links, hospitals, schools, and commercial areas differentiates high-value properties from the rest. Properties located along growth corridors stand to benefit considerably from the government’s massive infrastructure program, which aims to link emerging growth centers and spur the development of new ones.

When investing in real estate, Lobien reminds investors that they should choose a property that they can hold on to for at least ten years. Aside from the prospect of capital appreciation, they should also “look for a property that you love, that you can enjoy,” whether as one’s home or to pass on to family members.

The Velaris Residences: a strong proposition to investors

The unique combination as outlined by Lobien describes The Velaris Residences — the flagship development of RHK Land Corporation.

The Velaris Residences offers a strong proposition to investors: it offers the benefits of a strategic location that stands to gain the most from the government’s massive infrastructure push, and the elements that are most ideal for living in the post-pandemic world. Those who want a home or an investment vehicle will see how The Velaris Residences checks all the boxes that Lobien mentioned.

Located in Bridgetowne, a 31-hectare master-planned destination estate that spans Pasig City and Quezon City, The Velaris Residences enjoys direct access to C5 Road, Ortigas Avenue, and Amang Rodriguez Avenue. More importantly, it is sufficiently close to infrastructure projects that are now under construction or in the pipeline, putting it in an extraordinarily strong position to benefit from the growth effects of these over the immediate and long term.

Bridgetowne also offers easy access to the established business districts of Ortigas Center and Bonifacio Global City, as well as establishments. Sitting right at the country’s growth corridors, The Velaris Residences definitely stands to further appreciate in value as more infrastructure projects come onstream.

With its green and sustainable infrastructure, and artworks interspersed around the area, Bridgetowne is beautifully landscaped with trees and pocket gardens that provide a calming, serene atmosphere to those who live and work there. The Velaris Residences will rise across a verdant central park which residents will definitely enjoy, bringing in wide swathes of greenery and the grandeur of nature within their view.

Meeting investors’ design requirements in the new normal

Each unit at The Velaris Residences was designed using an intentional design philosophy, which revolves around the natural movement of the resident. Its luxurious, spacious units with high ceilings and natural lighting, large amenity areas, and good ventilation system, create an airy, comfortable feel that is especially important among those who prefer to spend more time indoors. This will emerge as a strong point in view of investors’ design requirements in the post-lockdown world. The building’s layout, which puts a premium on privacy and comfort, and the meticulous attention to detail, seamlessly combines luxury and function as only the developers of The Velaris Residences can.

The Velaris Residences is equipped with Smart Home features such as biometric fingerprint scanning, PIN code, RFID card access, smart digital locks for state-of-the-art security, smart mirrors, and smartphone-controlled lights and air conditioning system. These digital solutions, coupled with club-like amenities such as private lift lobbies, make The Velaris Residences a future-proof investment.

Merging the strengths of world-class property developers
Most importantly, The Velaris Residences is managed by a world-class property management team of two property giants, international property development leader Hongkong Land and Philippines real estate giant Robinsons Land. Both have the solid track record that is especially desired by investors, especially during a pandemic.

Hongkong Land is a major listed property investment, management and development group. The Group owns and manages more than 850,000 sq. m. of prime office and luxury retail property in key Asian cities, principally in Hong Kong, Singapore, Beijing and Jakarta. The Group also has a number of high quality residential, commercial and mixed-use projects under development in cities across Greater China and Southeast Asia. In Singapore, its subsidiary, MCL Land is a well-established residential developer. Hongkong Land is a member of the Jardine Matheson Group.

Robinsons Land Corporation (RLC) is one of the leading real estate companies in the Philippines and a subsidiary of one of the country’s largest conglomerates—JG Summit Holdings, Inc. With close to three decades of experience in property development, RLC is known as a reputable developer of mixed-use properties and residential condominium developments in key cities and urban areas nationwide.

As published in BrandRoom on March 23, 2021.