Call to relax foreign ownership laws in The Philippines
The property market in the Philippines is in a good economic position to sustain growth across all sectors, according to research published by real estate services agency KMC MAG Group.
"We expect the property markets to remain active throughout the year," said KMC MAG Group Managing Director Michael McCullough.
"There are a lot of reasons for this optimism, chief among them low interest rates, quantitative easing from the Central Bank and positive feedback from investors. These factors have helped create a favourable climate for both local and foreign businesses."
McCullough noted the rise of townships across various cities has created pockets of growth and development in Metro Manila. Major developers such as Megaworld, SM, and Ayala are focusing on township projects, with Megaworld turning its attention to McKinley West and Uptown Bonifacio, while SM is working on reclaiming more land and expanding the Mall of Asia complex, and Ayala developing the Arca South (Taguig), Makati Circuit (Makati), and Vertis North (Quezon City) townships.
In addition, developers such as Federal Land and Vista Land have also started to build townships, with the former building Metropolitan Park (Pasay) and Veritown Fort (Bonifacio Global City, Taguig), and the latter building Vista City (south of Manila ).
The ongoing race to build townships has also led to local developers pouring in massive amounts of capital. Capital expenditure programs are now expected to breach the Php300 billion level this year, covering land acquisitions, ongoing projects, and launches.
"The live-work-play lifestyle encapsulated in these townships has resulted into a lot of success for some of the major developers, so it's no surprise that new players are working to capitalise on this and bring the concept to new areas," noted McCullough.
"The township concept also provides a way for developers to be part of the solution to the congestion in Metro Manila. With developers creating new micro-districts and encouraging more Filipinos to live, work, and play closer to home we hope this will help reduce congestion and make Metro Manila more liveable, he said.
For the Philippines to attract more investments and fully maximize its positive momentum, McCullough said he believed that strengthening infrastructure and relaxing foreign ownership rules would be critical.
"To encourage more people to visit and invest in the Philippines, we need to make improvements in land and air transportation, from upgrading the metro rail system to building new roads, highways, and airports. That has to be a priority. We need to make it easier for potential investors to come in and see what we have to offer, he said.
"The government also needs to consider relaxing foreign ownership rules to give potential investors more of an incentive to choose the Philippines as an investment destination," he added.
"If the Philippines invests in connectivity throughout Luzon, Visayas, and Mindanao and supports this with good governance, sound macroeconomic policies, and more liberal foreign ownership rules, then it stands a good chance of becoming an economic powerhouse in Southeast Asia."
KMC MAG Group is an award-winning real estate services firm based in the Philippines with more than 100 employees. The company is also an International Associate of global real estate firm Savills.
Andrew Batt, International Group Editor ofPropertyGuru Group, wrote this story. To contact him about this or other stories emailandrew@propertyguru.com.sg
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