This week, Colliers Research provides insights on Megaworld Corp.’s newest condo project in Capital Town, the property developer’s 35.6-hectare mixed-use township in San Fernando, Pampanga. Colliers believes that Pampanga will continue to be a popular option among buyers of residential properties outside Metro Manila. Furthermore, German banking giant Deutsche Bank announces plans to expand in the Philippines, boding well for the office sector, which has recorded two consecutive quarters of positive net take-up.
Megaworld launches P2.8-B condo project in Pampanga
Megaworld Corporation launched Montrose Parkview, its third residential condominium project in its Capital Town township in San Fernando, Pampanga. The 15-storey residential tower will have 293 units and is expected to generate PHP2.8 billion (USD53.8 million) in sales. Montrose Parkview will have 14 unit types with sizes ranging from 35 to 169 square meters (376 to 1,820 square feet). Each unit will also have a wireless smart home system and devices with a Wi-Fi router. The condominium will be adjacent to a plaza, which will house several dining and retail stores, as well office towers. Megaworld expects to complete the project by 2027.
Colliers believes that Pampanga will continue to be a popular option among investors and end-users who plan to buy residential units outside Metro Manila. Based on our Q1 2022 Residential Survey, about 18% of respondents answered that they are considering buying a condominium unit in Pampanga, followed by Laguna (14%), Cavite (10%), and Bulacan (6%). From 2019 to 2021, we recorded an annual average take-up of 590 condominium units in Pampanga, up from the 560 units sold annually from 2016 to 2018. Condominium demand in the province is mostly driven by mid-income, upscale and luxury projects (PHP3.2 million and above). In terms of pricing, average price per square meter of condominium units in Pampanga is PHP113,600 (USD2,200), higher compared to Bulacan at PHP91,100 (USD1,750). Colliers recommends that developers be more aggressive with their land-banking initiatives especially outside of the Angeles–San Fernando–Mabalacat corridor. Meanwhile, local developers with a sizeable land-bank may opt to enter joint ventures with national players in developing large townships in the province.
Deutsche Bank looking to hire more, expand in PHL
Deutsche Bank is planning to expand in the Philippines and is looking to add more than 100 positions in 2022, on top of their current workforce of 1,500. Deutsche Bank Chief Executive Officer for Asia-Pacific Alexander von zur Mühlen plans to strengthen its footprint in the Philippines by tapping the country’s skilled workforce, highlighting Filipinos’ high level of English proficiency. The company is optimistic that its businesses in the country will expand as the economy recovers from the Covid-19 pandemic.
Colliers recorded about 325,100 square meters (3.5 million square feet) of office transactions in H1 2022, up 62% YOY. Meanwhile, we saw the second consecutive quarter of positive net take-up in Q2 2022 with net absorption reaching 45,100 square meters (485,300 square feet), the highest since Q1 2020. In our view, demand for office space should be sustained by traditional and outsourcing firms expanding in the Philippines beyond 2022. Colliers recommends that occupiers lock in spaces and secure early renewals in new buildings in Metro Manila offering discounted rates. From 2020 to 2021, discounts in major business districts ranged between 18% to 41%. Meanwhile, landlords should be more flexible to tenants’ requests to achieve optimal levels of occupancy. These include tenants’ preferred handover conditions, and the availability of short-term lease options and flexible workspaces.