Greenbelt being groomed as fashion capital
MANILA, Philippines — Traveling abroad to shop for luxury goods?
In a few years, maybe you no longer have to, as more luxury brands are looking to enter and set up shop in the Philippines. Ayala Malls vice president AC Legarda said eight to 10 luxury brands that currently have no presence in the country have approached them, wanting to open a boutique at Greenbelt in Makati City.
“Greenbelt now is being considered as the emerging fashion and luxury address not only in the Philippines, but in Southeast Asia,” Legarda said.
Ayala Land Inc. announced earlier this month it is allotting P13 billion to redevelop four of its major malls, which include Greenbelt.
Renovation work on Greenbelt 2, which will start this quarter, is targeted to be completed by 2026.
Mariana Zobel de Ayala, SVP and head of leasing and hospitality at Ayala Land and president of Ayala Malls, said Greenbelt will be transformed as the next fashion and luxury destination in the region.
Following the renovations for Greenbelt 3 and 4, she said there was an increase in demand in heritage luxury brands including the likes of Louis Vuitton, Dior and Fendi.
“We were quite impressed with the take-up of the market and demand for some of these products. And so Greenbelt 2 is specifically being renovated in an effort to allow more of these brands, these global heritage brands,” she said.
Aside from receiving applications from luxury brands that currently have no stores in the Philippines, Legarda said those located in the new wing of Greenbelt 3, which opened in 2021, have also expressed interest to expand.
Brands with stores at Greenbelt 3’s new wing include Louis Vuitton, Dior, Fendi, Cartier, Kenzo, Zegna, Roger Vivier, Celine and Off-White.
Legarda said luxury brands are focusing on Asia for their expansion.
Some luxury brands have even launched food and beverage concepts like the Dior Cafe in South Korea, Gucci Osteria in Japan and the BAPE Cafe in Hong Kong.
Based on conversations with principals of luxury brands, Legarda said there is a big local clientele in the Philippines, as at least two of their top five buyers are Filipinos.
“The market here definitely is ready. The Filipino market has been ready,” she said.
Gino Dizon, expert partner at global consultancy firm Bain and Co., said in an email the global luxury market, which is currently worth around €1.5 trillion annually, has shown resilience, growing around 10 percent year-on-year.
“Southeast Asia, including the Philippines, experienced positive momentum anchored by a growing local customer base, strong intra-regional tourism and foreign investment,” he said.
Going forward, he said the global luxury market is forecast to grow between four to eight percent annually until 2030.
Rizal Commercial Banking Corp. chief economist Michael Ricafort said catering to the luxury or high-end market is more profitable for property developers and other businesses or industries, given the premium pricing and higher margins.
He said the emergence of more affluent Filipinos could eventually help grow and sustain luxury spending in the country.
For Oikonomia Advisory & Research Inc. president and chief economist John Paolo Rivera, the local market, however, may not be quick to patronize luxury brands as the sought-after goods target a specific market, particularly, the affluent and foreign visitors or residents with a high purchasing power.
“Luxury products in the Philippines are relatively more expensive than in other countries due to tax-free shopping abroad, which the affluent and can-afford can take advantage of. There is no tax refund scheme yet in the Philippines,” he said, noting there have been previous initiatives on such for foreign tourists.
With the aim of catering to both the local and foreign shoppers, Legarda said the plan for Greenbelt is to offer not just international luxury brands, but also showcase Filipino designers that appeal to the global market.
“We will have affordable luxury. We will have heritage luxury…We have street lux, athleisure, we have the whole category…You should expect the best of the best, the widest variety of options in all categories,” she said.