Cebu deemed as the next retail destination in Asia

CEBU, Philippines - International consulting and property management firm, CBRE Richard Ellis expects Cebu to become the newest retail destination in Asia in the short-term, as study showed significant increase of retail giants taking advantage of the province’s dynamic retail trade.

“Indeed, Metro Cebu is maturing into the major retail hub of Southern Philippines and will become the newest retail destination in Asia,” said a market outlook recently released by the company.

According to the report, Metro Cebu, with an aggregate populace of roughly 1.5 million and a total land area of 408 square kilometers, can be likened to Singapore given its 694 square kilometer land area and 3.2 million resident nationals.

With the right push and consistent support from both public and private sectors, the consulting firm projects that Cebu could easily position itself as the newest shopping and retail destination in Asia.

The report indicated that the stable domestic economy of Cebu and sustained consumer confidence will bring Cebu to its highest position as shopping destination.

The uptick in retail spending, the report said that is backed up by the unabated inflow of overseas remittances and rising income due to the growing outsourcing industry in the Metropolis.

Moreover, the steadily increasing number of visiting tourists to Cebu significantly contributed to the retail sales growth.

The existing broad consumer base in Cebu prompted international brands to remain active in the leasing market, the report indicated.

In the second half of 2011, retail brand giant Forever21 launched a huge branch outlet in SM City Cebu. It is the first outlet of the US fashion brand outside of Metro Manila.

Likewise, Krispy Kreme opened stores at the Ayala Center Cebu and Asiatown IT Park simultaneously in October of last year.

The leasing market in Cebu is further strengthened by occupier demand from local retailers, because of this major retail estate players are rolling out several retail developments within Metro Cebu, from stand-alone supermarkets or neighborhood centers anchored by supermarkets of huge shopping malls, like the J Centre Mall in Cebu which was opened on November last year. — Ehda M. Dagooc

Existing shopping malls are also on their expansion mode anticipating the tremendous growth of retail industry in Cebu. Ayala Center Cebu for instance, will start the construction of its P2 billion mall expansion.

Meanwhile, Colonnade Shopping Mall, located in the downtown district of Cebu, which as 6,000 square meters of gross leasable area, was re-opened after undergoing major improvements amounting to P20 million.

Also in November last year SM Savemore Markets opened in Mandaue, while the SM Group also announced the soon to be opened SM Consolacion this year.                     

High-end retail group, Rustan’s also opened this year its first Shopwise outlet in Cebu located in Mambaling southern part of the metropolis.

According to the report, the retail sector thrives with the proliferation of mixed use office-retail buildings and residential condominium developments. Retail sales growth will

be buoyed by the demand coming from residents and employees.

Apart from the increasing population, and improving purchasing power, the demand for retail developments in Cebu is reinforced by the influx of domestic and foreign tourists numbering to about 5.6 million based on January to November 2011 visitor arrivals to Cebu record.

“With Cebu now becoming known as a major tourist destination, Cebu retailers are directly benefiting from the upsurge in tourist arrivals from shopping requirements as well as increased demand from HORECA [hotels, restaurants and catering services],” the report indicated.

It further said that this momentum continues to build up as government initiatives are geared towards the growth of investment and tourism of Metro Cebu. (FREEMAN)