SURVIVING THE COMPETITIVE CEBU REAL ESTATE MARKET
The entry of more national developers in Cebu has now redefined the property landscape in the province.
Among the national players that have successfully established a footprint in Cebu include Ayala Land, Robinsons Land, Megaworld, Filinvest Land, SM Prime, Federal Land, Rockwell, and Vista Land.
Integrated townships
To survive in such a fiercely competitive real estate market like Cebu, Colliers is thus encouraging national developers to be more aggressive in pursuing mixed-use communities.
“We believe that township projects, which integrate the live-work-play lifestyle, provide a better value proposition than standalone projects since they offer mixed-use developments such as office, residential, retail, even institutional,” the company said in a statement.
“This feature makes integrated townships a more attractive option for both investors and end-users. Colliers has ob- served that premium pricing especially for condominium units in Cebu is achieved by projects in masterplanned communities launched by major developers,” it further explained.
Integrated townships have also become more popular in Cebu given the inadequate transport infrastructure in the traditional business district—the uptown/downtown area.
Unlocking opportunities
National developers were successful in developing townships in Metro Manila and have applied the same concept in Cebu. Developers are bridging infrastructure gaps and unlocking opportunities by building master-planned communities that have the potential to become major catchment areas for business activities in Cebu.
Megaworld is replicating its successful Eastwood City, the first Peza-accredited IT Park, with Mactan Newtown; Ayala Land created a more contained version of the Makati central business district through the Cebu Business Park and Cebu IT Park; while Filinvest Land is developing City di Mare, and positioning it as the integrated lifestyle hub of Cebu.
The establishment of masterplanned environment continues to set national developers apart from local players.
“Colliers believes that the mixed-use projects will also become more attractive from now on especially as Cebu tries to retain its status as the second largest outsourcing hub in the country and one of the most attractive BPO (business process outsourcing) destinations in the world. We see more BPO tenants in Cebu shifting toward these mixeduse communities as these projects offer a better living and working environment,” the company added.
Infrastructure spending
The current administration’s thrust to raise infrastructure spending to 5 to 6 percent of the annual gross domestic product should greatly benefit Cebu, which is considered as one of the major urban areas outside of the country’s capital.
“We believe that the current administration’s goal of spreading economic opportunities and intensifying infrastructure development outside Metro Manila should provide impetus for national developers to be more aggressive in pursuing mixeduse projects in Cebu,” it said.
Given the rising popularity of integrated townships, Colliers said they expect national developers actively acquiring large parcels of land in Cebu that could be developed into masterplanned communities.
“Colliers believes that in the increasingly competitive real estate environment, developers need to distinguish their projects from others. We see competition intensifying especially with the completion of projects on Mactan Island, Mandaue, and South Road Properties (SRP),” the firm said.
“Apart from the typical land uses such as office, residential, retail, and hotel, developers should also incorporate other uses such as industrial, education and healthcare. We believe that developers should also integrate entertainment and recreational facilities for outdoor sports,” it concluded.