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7/30/2019 Colliers-Ten Predictions for 2013 (Philippines)
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Forecasts and predictions on the Philippine economy and real estate industryfrom various industry experts and Colliers International Philippines.
Ten Predictions for 2013
7/30/2019 Colliers-Ten Predictions for 2013 (Philippines)
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Ten Predictions for 2013
The World Bank raised its forecast for
the Philippine GDP in 2013 to 6.2%, upfrom 5%.
Japanese financial services groupNomura also raised their forecast for theGDP to 6.6% in 2013
Growth is expected to tick even higherin 2013 because of the impact of elections, fiscal improvement and governance reforms in private investment. - Nomura
1. Philippine economy to grow by around 6% in 2013
Forecast made by: Nomura, World Bank
7/30/2019 Colliers-Ten Predictions for 2013 (Philippines)
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Ten Predictions for 2013
The unfulfilled demand brought by the housing
backlog will continue to fuel residential sales. Thelow interest rate environment also allows morehomebuyers to afford their first homes.
Growth opportunities lie in second- and third-tier
cities with a high OFW emigrant population.
Strong take-up of high-end residential will continueas the economy grows. Vacancies for luxury rentalswill remain stable between 5-6%.
Expat market will grow and remain a major growthdriver for premium residences. Alien employmentpermits are seen to grow by 8% by end-2012, fuelingdemand for high end properties.
2. Residential demand to stay strong across all segments
Forecasts made by: Colliers International Philippines Research
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Ten Predictions for 2013
Remittances will continue to climb
albeit at a slower rate, with aminimum growth of 5.0-5.5%
IDEA: Remittances from majorsources remain buoyant but not fromEurope and UK.
Funds sent from abroad to continueto spur housing purchases.
3. Overseas Filipino remittances to continue upward trend
Source: BSP, IDEA
Forecast made by: Prof Ernesto Pernia of of the Institute for Development and Econometric Analysis (IDEA); Colliers International Philippines Research
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Ten Predictions for 2013
Bank of America sees the US dollar hoveringin the P39 range in 2013. Metrobank also
predicts further strengthening of the pesofrom P38 to P39 to a dollar.
Exporters and Overseas Filipino Workersmay be further put at a disadvantage.
Money transfers from overseas Filipinos tohit a record high of $24 billion this year to cope with the rising peso. World Bank
Manila office rates still seen as one of themost affordable in the Asia Pacific region
despite the appreciation of the Philippinepeso.
4. Peso to appreciate further vs. the dollar
Forecast made by: BofA, BSP, World Bank, Colliers International Research
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Ten Predictions for 2013
Business Process Associationof the Philippines (BPAP): BPOfull-time employees (FTEs) willreach over 1M by 2016 and willincrease annually by 10% in the
next 4 years.
Estimated new BPO FTEs fornext year is at 70,000 workers,
leading to approximately250,000 sqm of additional officespace absorption.
5. BPO to continue to shine, driving officemarket
Forecasts made by: BPAP; Colliers International Philippines Research
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Ten Predictions for 2013
Forecasts by HSBC and DBS indicate thatpolicy rates may stay at 3.5% for overnight
borrowing until the end of 2013.
U.S. Federal Reserve still holding their maininterest rate at near-zero levels until 2015.
Low interest rates seen to further encourage
borrowing, spurring investments as well ashousing affordability.
Still-high domestic demand and an unfavorable base effect could push headlineinflation higher. As such, we expect no more
easing, although rates will likely stay low until(fourth quarter of 2013). -HSBC
6. Interest rates to stay low
Forecasts made by: HSBC, DBS
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Prediction made by: Investment Services, Colliers International Philippines
Ten Predictions for 2013
Rates will increase by 3-5% for land
leases and logistics & storage facilityrentals. Local consumption seems to bedriving warehouse demand.
However, demand for industrial propertyfor heavy manufacturing may continue to
be generally flat. High industrial powerrates discourages expansion amongmanufacturing firms despite the wideavailability of labor and relatively lowerlease rates.
Interest from Japanese manufacturersrelocating to the country is seen as abright spot.
7. Warehouse leasing to perform better
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Ten Predictions for 2013
A short-term uptick in vacancy will likelyoccur due to the delivery of 214,000sqm of new retail stock in 2013.
However, overall retail sales will remain
healthy, driven by: Robust consumer spending
Growing middle income population
Sustained growth in OF remittances
Overall Metro Manila retail vacancyrates to stay below 10%
8. Metro Manila retail occupancy to slightly soften dueto increase in new supply
-
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,000
0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
12.00%
14.00%
16.00%
18.00%
20.00%
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012F
2013F
Retail Vacancy Forecast
New Supply (RHS) Average Vacancy Rate (LHS)
Forecasts made by: Colliers International Philippines Research
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Prediction made by: Colliers International Philippines Research
Ten Predictions for 2013
Aggressive overseas promotions by the
Department of Tourism and a robusteconomic environment will propel MetroManila hotel occupancy rates above70% on average.
The debut of Pagcor Entertainment Citywill also encourage more visitors to thecountry, particularly from neighboringcountries.
9. Hotels to enjoy higher occupancy rates
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Ten Predictions for 2013
Due to the recent spate of typhoonsand natural disasters, buyers will bemore inclined to invest in safer andmore secure residential types andlocations.
On the other hand, developers willbe more vigilant during their siteselection process, taking flood andearthquake risks into consideration.
Some areas such as Cavite alreadyseeing an influx of transferees fromflood-prone parts of Metro Manila.
10. Homebuyers to seek safer and higher ground
Prediction made by: Colliers International Philippines Research
7/30/2019 Colliers-Ten Predictions for 2013 (Philippines)
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Thank You
Karlo PobreResearch AnalystConsultancy and Valuation ServicesMain +632 888 9988 ext.4030Fax +632 845 2612Email [email protected]
Julius GuevaraAssociate Director & Dept. Head
Advisory & ResearchMain +632 888 9988 ext.4024FAX +632 845 2612Email [email protected]