Infrastructure projects to spur demand for industrial space in Luzon

MANILA, Philippines — More industrial spaces are expected to be developed in Central and Northern Luzon as the government implements key infrastructure projects in these areas, real estate services firm Colliers International Philippines said.

“Colliers believes that much of the new industrial supply in the near to medium term will probably be developed in Northern and Central Luzon,” the firm said in a statement.

Infrastructure projects such as the expansion of the Clark Airport, Subic-Clark cargo railway and the North Luzon Expressway – South Luzon Expressway (NLEX-SLEX) connector road are expected to impact on industrial activities in Northern and Central Luzon.

The expansion of the Clark Airport is expected to bring the airport’s capacity to 12 million passengers a year by 2020 from four million at present. 

Through the Subic-Clark cargo railway, which would connect Subic Port and Clark International Airport, the currently underutilized Subic Port would be maximized and the Manila Port is expected to be decongested.

“We see the project boosting Central Luzon’s feasibility as an industrial hub and stature as a key alternative to Southern Luzon,” Colliers said.

Colliers said the NLEX-SLEX connector road, which would cut travel time between major industrial hubs Clark in Pampanga and Calamba in Laguna from three hours to one hour and 40 minutes, would also benefit manufacturers with industrial facilities in both Central and Southern Luzon.

To capture the interest of firms looking for industrial space outside the Cavite-Laguna-Batangas region, Colliers said developers with industrial space in Pampanga and Tarlac have to speed up the completion of necessary public works such as roads.

“With more property developers heading to North and Central Luzon, Colliers believes that firms with significant public infrastructure completed will likely have the first-mover advantage over other companies,” the firm said.

It added developers may also have to consider partnering with local government units to acquire land and develop industrial space given increasing demand and lack of new industrial space.

Partnering with local government units would also ensure development is subject to land use plans and ordinances.