Trade and investment officials in Davao City remain bullish that the property development boom in the city will continue despite exclusion of the industry from the city’s preferred investment areas which previously entitled the developers to avail of various fiscal and non-fiscal incentives.
Teolulo Pasawa, chief of the Department of Trade and Industry-Davao City Field Office (DTI-DCFO) said property development remains as one of the fastest growing
industries in the city, noting several building constructions in the city centers.
“I am expecting more real estate development projects, especially high-rise projects. As you can see, there are only few high-rise developments that have been put up in Davao City so far,” he said.
Pasawa said the coming in of new investors to Davao City only shows that there are still lots of opportunities and untapped markets in real estate development, adding that with the tight competition among developers, Dabawenyos can expect better innovations in the industry.
Jason C. Magnaye, Davao Investment and Promotions Center chief, echoed the same observation, saying that property development in general has become an attractive investment area in the city even after the city government scrapped perks granted to new investments in the property sector.
“Our new preference is derived from the present demand in the city for additional infrastructures, lacking support services to certain business activities that are considered to be sunrise industries, and emerging trends in both the local and international markets,” he said.
Magnaye said the sector which has the most investments and employment generated in the records of the Davao City Investment Promotion Center (DCIP) is property development.
“Considering the ripeness of the industry for promising returns on some of its products, we have refined this area to cover only the development of residential areas for low cost and socialized housing and the establishment of industrial estates and IT Parks classified as special economic zones,” Magnaye said.
Roberto P. Alabado III, City Planning and Development Office head, said big property firms are projecting a rise in demand, not only for residential projects, but for offices as well.
The entry of investors in BPO and other related businesses has been a major source of optimism for local property owners since two years ago.
“This is a natural thing for a growing urban center like ours,” said Alabado.
Jaime G. Adalin, head of the City Building Office, said the entry of major developers indicates a growing market in the years to come.
“(They) have made the city a very good investment area,” he said.
Based on City Building Office data, capital flow to the property sector between January and September this year summed up to P2.175 billion for 15 projects, the newest being the 12-floor structure of Felcris Hotels and Resorts Corp. intended for business process outsourcing (BPO).
The Felcris structure will be built just beside the company’s three-floor shopping mall, also the newest commercial/retail project in this city.
The company said it will initially spend P838.967 million for the high-rise building and capital expenditure for the project may hit P1 billion.
Another project is the 26-floor condominium that Alveo Land, Inc. is building within the 10-hectare mixed-use joint venture between Ayala Land, Inc. and Anflo Investment and Management Corp. of the Floirendo family. Alveo is an Ayala Land subsidiary.
Another is the 11-floor hotel of SM Prime Holdings, which opened its second shopping mall in the city last month. The cost of the hotel is estimated at P284 million.
The Gotianun-led Filinvest Land, Inc., meanwhile, is also building a five-floor condominium and investing about P143 million on the project.
Pasawa mentioned a P3-billion steel plant project in Bunawan Proper
awaiting the approval of the city council as proposed by the New
Carcar Manufacturing Inc., a subsidiary of Steel Asia, one of the
biggest rolling bar producers in the country.