Insight

Philippine real estate industry: New growth corridors are on the rise

Major real estate developers have now made their presence felt in these growing suburban areas, pushing for differentiation and dominance as interest and excitement grows in new markets, trade areas, and upcoming economic zones. 

The Department of Transportation’s 2024 budget of PhP214.3 billion is 102% higher than the previous year’s PhP106 billion.* This more than doubling in infrastructure spending represents a significant economic thrust of the Marcos Administration.  


More than 75% of the funds are going to mass transit projects, particularly rail. Among the flagship projects are the North-South Commuter railway to connect Clark, Pampanga to Calamba, Laguna; and the Mega-Manila Subway that would increase mobility and capacity for the northern and South Metro Manila districts. And there’s also the New Manila International Airport in Bulacan. 


The anticipated improvement in people and cargo mobility opens new corridors for investment, growth, and development around the capital Metro Manila, particularly the regions of Central Luzon and CALABARZON.  


These infrastructure initiatives — along with the increasing demand for industrial estates, logistical hubs, and residential assets — have triggered investments from real estate developers. They have been buying up tracts of land in and around these growth corridors. 


All major real estate developers have now made their presence felt in these growing suburban areas, pushing for differentiation and dominance as interest and excitement grows in new markets, trade areas, and upcoming economic zones.  


As with any shift of investment and economic growth, the adage “Where the Money Goes, People Follow” will always hold true. This marked movement of capital would trigger a population shift from traditional urban areas, which then drives commercial retail investment to satisfy a growing consumer base in heretofore suburban and provincial locations.   


Such a dynamic and active investment marketplace demands focus and clarity to build differentiation and value-added for enterprises that seek to capitalize on these new economic corridors.


Achieving focus and clarity to carve out leverage and an advantage, however, may not come easy for real estate companies given the pace of external developments and/or limitations within the organization. 


That’s where Acumen Strategy Consultants can step in with its more than two decades of experience working with top-tier companies across various industries, including real estate.  


It’s very exciting times for property development in the Philippines. To keep up and be part of the sector’s growth, real estate firms will have to ensure that their business and commercial plans as well as the people in their organizations are aligned in terms of purpose and ambitions. 

References:

*Department of Budget and Management (2023). Big chunk of DOTr’s budget for 2024 allocated to infrastructure development

Written by: Rogie Santos - Client Director, Acumen Strategy Consultants

Rogie has been a management professional for 27 years, with a core focus as Operations Managing Director in real estate services and property management segments.

September 12, 2024

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