“BUY real estate in areas where the path exists and buy more real estate where there is no path, but you can create your own” -David Waronker, American real estate investor.
The presence of a number of Central Business Districts (CBDs) in the Philippines is a clear indication that the country is experiencing a booming economy with a strong real estate market. The CBDs such as in Makati, Ortigas, and Fort Bonifacio have the highest concentration for economic growth due to its strategic location and stable increase in land values every year.
In this manner, property developers are levering up their developments on these CBDs because of its potentials to become a center of progress with an expected high demand in real estate users and investors.
But what makes a central business district?
1. Location
A CBD is an area that never ceases to evolve into a more dynamic cosmopolitan scene. It means that it is positioned as a melting pot of top multinational and local corporations, commercial and residential establishments, as well as educational and medical institutions.
2. Adequate Infrastructures
Another factor to define a CBD is its well-planned infrastructures. A CBD must establish an efficient traffic system and road networks with the presence of sidewalks and pedestrian underpasses. As well as the presence of effective basic facilities, services, and installations such as communication systems, water and power lines, and public institutions.
It is very imperative for a CBD to have such good infrastructure system because it has an impact on the productivity and performance of the area.
3. Presence of multinational companies
The existence of modern office buildings is an indication that a CBD is a hub for business, trade and commerce. A CBD has its own urban masterplan that caters to the influx of multinational companies including those in Banking & Finance, Business Process Outsourcing as well as Information Technology industries, among others.
4. Presence of major developers
Another indication of a CBD is the presence of major property developers due to the rising demand for residential, commercial and office properties in the area. It is apparent that CBD has the highest return of investment when it comes to rentals and leasing with increasing land values every year.
With all these indicators, it is undeniable that Makati, Ortigas, and Fort Bonifacio lead the pack of major established CBDs in the country today. This is actually an indication that Metro Manila is enjoying an “urban revolution” where growth areas are successfully taking off not just in one area of the capital but in different locations.
Alabang As The Next Growth Corridor
Today, another growth area which can potentially turn into a new CBD is Alabang. Taking into consideration all the indicators listed above, Alabang is ripe to become the new CBD in Metro Manila, following the footsteps of Makati, Fort Bonifacio and Ortigas. Aside from serving as an alternate hub for some major multinational corporations, Alabang is known to be a commercial and residential hub in southern Metro Manila. This year, it will also benefit from the major infrastructure projects that link Alabang to other areas such as The Manila-Cavite Expressway (Cavitex); South Luzon Expressway-Daang Hari Road; Muntinlupa-Cavite Expressway (MCX); and the Cavite-Laguna Expressway (CALAX). These roads offer new routes to minimize their traveling time going to their desired destination without being caught up by a traffic jam in Metro Manila.
Based on a study conducted by independent property research firm Cuervo Far East, the rise of the Southern Manila West Growth Area (WGA) in which Alabang is part of (as it is on the western side of southern Metro Manila) paves the way for this part of the metropolis to be the next CBD.
It revealed that this area is a promising location for future property investments as property values may soar to around P100,000 per square meter or higher by 2019.
Some of the biggest real estate developers already have invested in this area such as Ayala Land, Megaworld, Filinvest and Vista Land. Just recently, Megaworld announced it is building a 62-hectare township development with an upscale village called Alabang West, and it has been selling lots like hotcakes in the past three months. Vista Land, for its part, has aggressively been selling lots and condominiums for its huge property called Vista City near Daang Hari.
So expect that in the coming months, we will see more developers selling properties in this side of Metro Manila and Alabang will certainly be the flavor of the year.
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Prof. Soriano is an ASEAN Family Business Advisor and Chair of the Marketing Cluster of the ATENEO Graduate School of Business. He is a National Agora Awardee and book author of Kite Runner, a book on Family Business Governance and Succession. For comments, you may email the writer at [email protected]
