Property sector to fare better this year, says realty firm head

Having reached the bottom in 2000, the real property sector, particularly the medium and high markets, is expected to fare better this year than in 2001 with an anticipated five percent growth.

This fearless forecast was made by Victor Manarang, president and CEO of One Asia Development Corp. to the Star even as he noted sector has already shown improvements in 2001 despite the terrorist attack in New York which caused many global businesses to slow down last year.

"We seem to have reached the bottom already in 2000 and since 9-11 did not adversely affect the property sector in the Philippines, we see no other factors that might cause a reversal of the upward trend we have already been witnessing," Manarang said.

Still, he said, the sector is "crawling" and would grow only keep pace with the economy.

One Asia is involved in the broad spectrum of the property business–from development of low-cost and socialized housing to high end condominiums and town homes, with its newest project launched at the Celebrity Place beside the Celebrity Sports Plaza in Diliman, Quezon City, Celebrity Place has 62 townhouses that are low-density along a relatively elevated place and 142 condominium units.

Its three bedroom townhouse costs P7.6 million to P8.5 million while its four bedroom townhouse, P10 million to P11 million. It also has condominiums in the site with a total of 142 units, 36 of which he said are already "spoken for." Of these total condominium units, 51 fall under Phase 1 of the development.

Manarang said the problem with the property boom of 1996 and prior years was that they concentrated on high rise, high cost developments, geared mostly to the niche market of expatriates and young executives, whose businesses unfortunately suffered from the Asian financial flu in 1997 and later years.

The low cost housing would still have a flat or no growth because government’s infusion into this sector would not be commensurate to its collection of previous loans extended to beneficiaries, he said citing that low cost housing would continue at 30,000 to 40,000 units a year against a backlog of 400,000 to 500,000 units.

Housing requirements for the medium income group or those costing P500,000 to P2 million, will again post a 5 to 6 percent growth mainly from the overseas Filipinos and professionals working abroad and investing in housing, he said.

The high end market, those above P2 million, is polarized and is distributed between Makati and Ortigas, which is still experiencing a glut in available units particularly in high rise condominium houses and offices, he said.

High rise buildings in these districts are having vacancy rates of 16 percent which began after the 1997 crisis. Because of a supply glut, he said, some developers have devised innovative selling schemes such as entering into monthly installments/leases of as low as P12,000 to P17,000 stretched over three years. This bracket will experience again a flat or no growth, he said.

He said that Celebrity Place has a distinct edge of being the only property development with a sports complex (tie up with Celebrity Sports Plaza), being within a government center and university area and in an elevated and cool place within Metro Manila.