PROPERTY research firm Colliers International Philippines (Colliers) foresees a spike in the land value in areas near the Mactan-Cebu International Airport (MCIA) and the third bridge that connects Cordova and Cebu City.
Joey Bondoc, senior research manager at Colliers, said land prices in these areas are expected to increase on the back of the infrastructure boom and the entry of Philippine offshore gaming operators (Pogo) in Mactan Island.
“Definitely, land prices will increase,” said Bondoc, during the Colliers Cebu Property Market briefing Wednesday, July 17, 2019.
GMR-Megawide Cebu Airport Corp., the private operator of MCIA, is currently upgrading the domestic terminal of the airport while the construction of the P2.5-billion second runway is set to begin in January 2020. The Cebu-Cordova Link Expressway (CCLEX), the third bridge connecting Cordova and the South Road Properties of Cebu City, is targeted to be completed in 2021.
Bondoc said developers should start looking at these locations because they can expect a 50 to 100 percent increase of land prices once they sell it (properties) to the public.
“That’s a big growth. In fact, not just when completed because upon drilling, prices escalate because that’s speculative market,” Bondoc said.
Prices
In their research, the asking rate of the lots per square meters in 2018 was at P25,000 to P35,000 in Mactan and Mandaue. Bondoc said this is 30 to 40 percent higher compared to 2017 asking rate, prior to the completion of the MCIA expansion.
“Now that it is completed, we will see more aggressive expansion (of projects) especially in Mandaue area. Condominium supply in that area will double by 2021,” he said.
As of the first quarter of 2019, the overall condominium inventory of Cebu stood at 42,100 with bulk of the inventory or 76 percent is located in Cebu City with 32,050 units followed by Lapu-Lapu City with 7,232 units (17 percent ) and Mandaue City at 2,813 units ( seven percent).
By end of 2021, Cebu’s condominium inventory will reach 51,900 units. Cebu will have 38,100 total condo units while Mandaue and Lapu-Lapu cities will have a total of 5,100 units and 8,700 units, respectively.
“The outlook is good because in first quarter of 2019, we are already beyond the 50 percent take-up,” said Bondoc.
Some 2,468 mid-income units with prices ranging from P3.2 million to P5.9 million comprise bulk (62 percent) of the condominium launches in the first quarter of 2019, followed by the affordable segment (34 percent) with 1,340 units launched with prices ranging from P1.7 million to P3.19 million and luxury segment (five percent) with 186 condo units launched.
“The record high supply and demand in Cebu was recorded in 2016. Considering that we are still in the first quarter and figures are already encouraging, so we might breach that by 2019. We might see new record high demand and supply for condos in Cebu,” he said.
Growth drivers
One of the drivers of condominium demand is Pogos.
Bondoc said this new market may occupy newly-launched office spaces in the province especially in Mactan and Mandaue.
“There will be a huge increase in condominums in Mandaue because they’re complementing the expansion of new office spaces there,” he said. (JOB)