Building the Future: Infrastructure Surge Fuels Real Estate Boom in the Philippines
By: Velorine
THE PHILIPPINE government’s ambitious infrastructure program is expected to reshape the real estate market, driving up land values and office lease rates, according to analysts.
“Massive public investments in infrastructure should stoke Philippine property, benefiting developers with condominium projects across the country,” Joey Roi Bondoc, director and head of research at property consultancy group Colliers Philippines, said in an interview with BusinessWorld.
“Buyers of luxury projects will likely gravitate towards residential developments near public infrastructure projects,” he added.
Transport infrastructure projects, such as the Metro Manila Subway, expected to be completed in 2028, are seen to benefit major central business districts (CBDs) like Quezon City, Ortigas, Fort Bonifacio, Pasay, and Valenzuela.
Other projects awaited by property developers include the Mass Rapid Transit (MRT)-7 and 4, the Manila-Clark Railway, the New Manila International Airport in Bulacan, and the Light Rail Transit Cavite Extension Phase 2. The Cavite-Batangas Expressway, the Central Luzon Link Expressway, the Bataan-Cavite Bridge, and the rehabilitation of the Ninoy Aquino International Airport are also in the pipeline.
“Proximity to infrastructure is a normal amenity these days, and developers can command premium prices and rents for properties situated near infra projects,” Mr. Bondoc said.
He noted that from 2016 to 2023, house and lot prices in these regions rose by an average of 3.6 to 7.2% per annum.
Meanwhile, lot-only developments saw price increases of between 6.7% and 15.4% per year during the same period.
For the office market, Mr. Bondoc said the increase in rents and values of properties near new transportation hinges on the attractiveness of locations to tenants and the current vacancy rates.
“Aboitiz InfraCapital’s Economic Estates and Aboitiz Land’s residential communities are strategically positioned to capitalize on the transformative effects of new infrastructure developments,” AboitizLand, Inc. said in an e-mail to BusinessWorld.
