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Market Intelligence | Philippines October 15, 2021

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This week, Colliers Research provides insights on the planned 85-hectare Megaworld mixed-use township in Bulacan Province; ANZ Research noting that consumption will remain muted for the rest of 2021; and the launch of Mandtra Residences Tower 2, Cebu Landmasters’ newest condominium development in Mandaue.

Andrew Tan expands further north with P98B urban township in Bulacan
NEWS

Megaworld Corp. is investing P98 billion for the development of “Northwin Global City,” an 85-hectare mixed-use township in Bulacan. It is envisioned to be the first metropolitan hub for business and lifestyle in the province. Northwin will feature high-rise residential condominiums, office towers, hotels, shopping malls, and educational institutions. It will also host one of the stations of the Manila–Clark railway project. The township is 20 minutes away from the proposed New Manila International Airport in the municipality of Bulakan, Bulacan.

RESEARCH VIEW

In our view, developers have been aggressive in developing townships outside Metro Manila as they take advantage of the government’s infrastructure projects. Colliers believes that more property developers are likely to establish their footprint in provincial locations, including Metro Cebu, Iloilo, Bulacan, Bacolod, and Clark in Pampanga, which are ripe for townships given the government’s “Build Build Build” program. In our opinion, developers should consider the proximity of their future residential and office projects to ongoing infrastructure developments. Projects such as the Manila–Clark Railway, Tutuban–Malolos Railway, LRT-1 Cavite Extension, LRT-2 East Extension, MRT-3 Rehabilitation, and the MRT-7 are essential in decongesting Metro Manila as they boost connectivity between the capital region and key provinces viable for more property developments.

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Weak consumption likely to persist
   

NEWS

ANZ Research said that consumer spending may likely remain muted this year as the pent-up demand is unlikely to deliver a significant economic rebound given the renewed lockdown restrictions. ANZ Research projects household spending to rise by a measly 1.4% in 2021, from a 7.9% drop in 2020. However, this is still far from the pre-pandemic growth of about 5.9% in 2019. Despite the muted household consumption, ANZ Research expects the country’s GDP to grow by 4.2% this year, within the government’s target of between 4% and 5%.

RESEARCH VIEW

Colliers saw vacancy across shopping malls in Metro Manila rising to 14% in Q1 2021, up from 12.5% in Q3 2020 due to the closure of several brick-and-mortar stores in the capital region. We see vacancy rising further to 16% by the end of 2021 as consumer confidence and foot traffic remain subdued due to the mobility restrictions imposed by the government. Colliers sees consumer traffic improving once the government relaxes quarantine restrictions across the capital region. Mall operators should continue maximizing their online platforms while retailers should complement their physical stores with e-commerce platforms.

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Cebu Landmasters breaks ground for Mandaue project

NEWS

Cebu Landmasters Inc. (CLI) said that they are planning to launch the second tower of Mandtra Residences in Mandaue ahead of schedule as they have observed sustained demand on their first tower, which is already 90% sold in five months. Mandtra Residences will consist of 1,879 studio and one-bedroom units. The project will also include a fitness gym, jogging path, chapel, function hall and a clubhouse. Mandtra Residences is slated for completion by Q1 2025.

RESEARCH VIEW

As of H1 2021, total condominium stock in Mandaue City reached 4,509 units. By the end of 2021, we see the delivery of about 6,563 condominium units in Cebu where Mandaue is likely to account for 42% of the new supply. Meanwhile, the affordable to mid-income segment (PHP1.7 to PHP3.2 million) accounted for 84% of take-up in H1 2021. The growing demand for this price segment relates to the rising purchasing power of Cebuano end-users and investors. In our view, regional economic rebound and sustained remittances from Filipinos working abroad should raise residential demand in Metro Cebu beyond 2021.

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