Makati, BGC, Ortigas land values still seen accelerating up to 8.5%
Rosalinda L. Orosa (The Philippine Star) - November 9, 2014 - 12:00am

MANILA, Philippines - Land values in business districts such as Makati, Fort Bonifacio and Ortigas are estimated to grow by 6.5 to 8.5 percent in the next 12 months even after reaching a 17-year high from recent transactions  amid strong demand from investors and developers, real estate services firm Colliers International Philippines said.

Colliers International Philippines director Julius Guevara said in a briefing yesterday land values in Makati, Fort Bonifacio and Ortigas are expected to grow by 6.5 to 8.5 percent in the next 12 months.

The growth in land values is seen as there is a lack of available land assets while investors and developers are scouting in these areas.

 “There are a lot of undeveloped lots usually held by the high net worth individuals who have no use of their money. They are just holding on for the future, for their kids, for their legacy… And there is strong demand for land areas. Property developers are always looking,” Guevara said.

Land values are seen to rise even after reaching a 17-year peak with recent transactions.

State pension fund Government Service Insurance System sold its two lots in Fort Bonifacio with land areas of 1,600 square meters (sq.m) each to Focus Palantir, Inc. and Goldenwill Inc. with a price of P500,000 per sq.m and P458,000 sq.m, respectively.

Property developer Ayala Land, Inc. also recently bought the JAKA Tower in Makati for an undisclosed amount, the price range of which is estimated to be between P500,000 and P560,000 per sq.m.

As a result of these transactions, average land values have climbed in the three business districts.

As of the third quarter, Fort Bonifacio’s average land values posted a 38.23 percent uptick to P250,000 to P500,000 per sq.m from the previous quarter, while Makati saw an 18.71 percent growth in land values to P310,000 to P560,000 per sq.m in the third quarter compared to the second quarter.

In Ortigas, average land values have risen 3.10 percent to P118,000 to P190,000 per sq.m in the third quarter from the previous quarter.

In terms of office supply, Guevara said real estate developers remain bullish amid strong demand from the business process outsourcing (BPO) sector as well as other traditional takers.

 “We expect 482,000 sq.m of new office space by the end of the year,” he said.

Amid advisory firm Tholons’ projection that the Philippine BPO sector could grow to $48 billion by 2020, new office supply is expected in the coming years.

Colliers International Philippines expects an average of 420,000 sq.m of office space to be introduced annually in the next five years.

Meanwhile, property developers are cautious on the introduction of residential projects with numerous projects unveiled since 2011.

 “With the risk of overdevelopment, property developers are in control of that. They are pulling back,” Guevara said.

He added that even if no new residential projects are launched after the third quarter, there is enough supply.

 “If would take 1.9 years to absorb the remaining inventory,” he said.

 

AYALA LAND COLLIERS INTERNATIONAL PHILIPPINES FOCUS PALANTIR FORT BONIFACIO FORT BONIFACIO AND ORTIGAS GOLDENWILL INC GUEVARA LAND MAKATI VALUES
  • Latest
  • Trending
Latest
Recommended
Are you sure you want to log out?
X
Login

Philstar.com is one of the most vibrant, opinionated, discerning communities of readers on cyberspace. With your meaningful insights, help shape the stories that can shape the country. Sign up now!

FORGOT PASSWORD?
SIGN IN
or sign in with