ON GENERAL PROPERTY
Despite the pandemic, initial public offerings (IPOs) of real estate investment trusts (REITs) have become successful in the Philippine stock market. With this, more companies may be encouraged to consider offering the investment vehicle according to analysts.
Recently, four REIT companies have listed at the Philippine Stock Exchange, with Megaworld Corp.-sponsored MREIT, Inc. being the latest. Debuting with shares closing at Php 16.70 each from its Php 16.10 listing price, MREIT has already raised over Php 15 billion from its IPO.
RL Commercial REIT, Inc. (RCR), the largest REIT in the Philippines, raised Php 23.5 billion as of September while Filinvest REIT Corp.’s IPO acquired Php 12.6 billion in August.
According to Metro Investment Corp.’s Head of Research Cristina S. Ulang, “Philippine REITs are likely to soar with the global economic recovery benefitting the business process outsourcing sector growth.”
Small to medium property developers are also being encouraged by the Philippine Stock Exchange into tapping the REIT market to generate capital for their development projects.
ON INDUSTRIAL
The first nine months of 2021 have brought a 117% jump in consolidated net income for AyalaLand Logistics Holdings Corporation (ALLHC).
Industrial lot sales have amounted to Php 1.1 billion this year as compared to Php 511 million of the previous year as the demand continues to rise.
Warehouse leasing revenues also rose this year up to Php 299 million compared to Php 282 million from last year because of the gross leasable area completed in 2020.
According to ALLHC President and CEO Maria Rowena M. Tomeldan, “we see signs of recovery in our business lines with industrial lot sales driving significant improvement in our overall performance this quarter.”
ON OFFICE
The Philippine Economic Zone Authority (PEZA) WFH memorandum has been extended up to March 2022 which may subdue activities for the office and residential sectors. According to Janlo de los Reyes, JLL Philippines head of research and consultancy, the national elections may also dampen the leasing and investment activities in the real estate market.
Office re-entry timelines are being pushed to 2022 with occupiers being unsure about their space requirements.
The current WFH arrangement has led to the continued weak residential lease demand. BPOs continue to drive the demand for both sectors.
Supply is expected to peak for all real estate sectors in the coming year as the real estate market continues to be fluid. Anticipated stock is 714,00 sqm for office space, 535,300 sqm for retail, and 6,300 rooms for hotel.
ON RESIDENTIAL
According to the survey conducted by Bangko Sentral ng Pilipinas (BSP), mid-range salaried Filipino households consider their residential property or house and lot to be their most valued asset.
Based on the 2018-2019 Consumer Finance Survey that covered 14,860 households, 71.6% owned or co-owned residential property while 45.4% owned house and lot. Approximately 26.2% held a housing unit while 8.8% owned other real estate properties.
The survey also showed that about 28.2% of households had outstanding loans. This includes PAG-Ibig Fund and National Housing Authority housing loans, in-house financing for vehicle loans, and financing companies/ institutions for business and other consumer loans.
Households are able to pay their loans on time: 64.6% of vehicle loans; 43.3% of housing loans; 86.3% of business loans; 77% of other loans; and 69.6% of credit card loans.
ON TOURISM
Philippine Airlines (PAL) would be able to add more international flights leading up to the peak holiday season given the opening of more domestic gateways and arrival limits for Manila.
Recently, the cap for Manila arrivals has been raised to four thousand passengers per day.
More flights will be added from the Middle East, the United States, Australia, and other Asian countries says PAL SVP and Chief Strategy and Planning Officer Dexter Lee to accommodate the needs of overseas workers looking to come home for the holidays.
They are likewise increasing flights to Manila from Los Angeles, New York, Guam, Singapore, Doha, Taipei, Sydney, and Melbourne.
Sources:
Abadilla, E. V. (2021, November 04). Pal adding more flights for peak season. Retrieved November 05, 2021, from https://mb.com.ph/2021/11/04/pal-adding-more-flights-for-peak-season/
Cahiles-Magkilat, B. (2021, November 01). Elections to dampen office leasing -- JLL. Retrieved November 05, 2021, from https://mb.com.ph/2021/11/01/elections-to-dampen-office-leasing-jll/
Chipongian, L. C. (2021, November 01). Property ownership is a top household asset – BSP survey. Retrieved November 05, 2021, from https://mb.com.ph/2021/11/01/property-ownership-is-a-top-household-asset-bsp-survey/
Loyola, J. A. (2021, November 04). Industrial Lot Sales Boost Ayalaland Logistics earnings. Retrieved November 05, 2021, from https://mb.com.ph/2021/11/04/industrial-lot-sales-boost-ayalaland-logistics-earnings/
Valmonte, K. G. (2021, October 04). More firms seen launching reits. Retrieved November 05, 2021, from https://www.bworldonline.com/more-firms-seen-launching-reits/