FOR some Cebuanos, a construction boom does not only mean homes and skyscrapers. Rather, it has come to symbolize a better and more comfortable life, trips abroad, and flexible work schedules for real estate brokers and sales professionals.
Gaylord Tingzon is one of them. He started a career in 2011 in the real estate sector as a property consultant for Ayala Land Inc. Six years after he began selling condominiums for the property giant, he found himself opening his own brokerage firm last May 18, selling various properties all over the country, but most of which are in Cebu.
Colliers International, a global real estate services group, forecasts that Cebu’s real estate will continue to see growth across all fonts: residential, retail, office, as well as industrial.
“The country’s property sector remains upbeat as it is fueled by a robust macroeconomic environment. We encourage developers and tenants to take advantage of the country’s buoyant macroeconomic backdrop,” it said.
For its part, the Housing and Land Use Regulatory Board (HLURB) has reported a triple-digit growth rate in the rise of License to Sell (LTS) applications for condominium projects.
From 40 LTS applications received in 2016, at least 113 reached the agency this year or an increase of 183 percent, preliminary data from HLURB Central Visayas showed as of Dec. 5, 2017.
An LTS is a certification a property developer obtains from HLURB, which serves as proof that the developer has a legitimate business and the financial resources to complete the project they are selling.
Out of the 113 applications for an LTS, more than 80 percent has yet t be approved. HLURB Central Visayas Director Francis Ordeniza said that only 20 LTS for condominiums have been issued by his office this year, primarily due to the lack of building permits.
The approved condo projects will produce 3,829 condominium units with a total project cost of P15.6 billion.
Sought for comment, Cebu City Office of the Building Official (OBO) head Engr. Josefa Ylanan said building permits have not been issued to some projects because of insufficient parking lots.
“I know they can comply, but they are just trying to maximize their profits. We keep reminding these developers to take into consideration in their design the presence of open spaces. They also need to be aware of the laws within the places they will build their projects since there is only one national law and that is the Building Code,” said Ylanan.
For instance, low-cost condominiums are supposed to have one parking slot for every 10 units. This is what most of the developers have a hard time complying with, the official said.
Meanwhile, subdivision projects with an approved LTS reached 38, from last year’s 62. Ordeniza said the drop was caused by delays in the approval of survey returns from the Land Management Bureau, an attached agency of the Department of Environment and Natural Resources.
Retail space in Cebu is also seeing expansion.
The latest data as of the first quarter of 2017 from Colliers show that Metro Cebu’s retail stock stood at 1.01 million square meters of leasable space, or more than double the metro’s retail supply in 2008 of 465,000 square meters. Retail vacancy during this period was at 2.2 percent from two percent recorded a year ago.
More room for retail
Over the next 12 to 36 months, retail space in Cebu will further expand. Among those expected to be completed this year are Il Corso of Filinvest at the South Road Properties and NorthDrive Complex of local developer Elin Land in the North Reclamation Area. The projects, once completed, will deliver an estimated 44,000 square meters of leasable space.
Strong manufacturing prospects in the country will drive demand for industrial parks and standard factory buildings (SFBs). Colliers has identified Cebu as a major hub for industrial operations outside Luzon.
“This year is different from last year as the previous year (2016) was a year of strategic partnerships between local developers and international or national partners,” said Tingzon.
Looking forward to 2018, Tingzon is optimistic the real estate sector will continue to do well. The HLURB regional chief echoes the sentiment.
“This is the best time to be a real estate broker or a real estate salesperson because in 2018, Cebu will have more projects than ever,” the broker said. He expects the pending condominium and housing LTS applications lodged in the HLURB to be approved next year. The rollout of the Duterte administration’s infrastructure projects is seen to support Cebu’s real estate sector, especially if this would be matched with an efficient transport system.
Although the property sector’s outlook remains robust, Tingzon took note of the housing backlog that the industry has yet to address.
“There are so many buyers but there is not enough inventory that can satisfy the needs. The demand is in low-cost housing, which the developers are having a hard time coping with because of the scarcity of land and the high prices of land located near the city, the preferred location,” he said.
Quoting the Housing and Urban Development Coordinating Council, Tingzon said the country’s housing backlog stands at 5.5 million, of which 1.9 million are in the Visayas alone and are concentrated in the low-cost segments.
Worsening traffic in Metro Cebu is also affecting the industry, as it is one of the considerations among clients before investing, he added.
Still, his outlook for the year ahead is upbeat The realtor and his partner May Godino, also a broker, are expecting a child soon. In May 2018, he will also be celebrating the anniversary of Skyscraper Realty, his brokerage firm.