The Cebu market can ride on the current upswing in real estate in the Philippines once the Real Estate Investment Trust (REIT) Law is fully implemented.
According to a Sun.Star report, leading real estate services provider Colliers International Philippines projects that the establishment of REITs will result to more townships and integrated communities being constructed in Metro Cebu.
Colliers has likewise predicted that office and retail spaces will be viable sources of income for property developers in Cebu. Demand for office space will come from outsourcing and offshore gaming companies. Beyond Cebu Business Park and IT Park, occupants looking to lease office spaces should consider properties in Mandaue, especially firms who are not into business process outsourcing.
The tourism industry, particularly hotels, will also benefit once the REIT Law is carried out this year. The growing number of foreign arrivals saw an increase of 10% per year on average in the past three years. The Department of Tourism predicts that these arrivals will increase by 15% within the year. In turn, this will spur demand for facilities to hold meetings, incentives, conventions, and exhibits. Demand will also be driven by local travel, as people warm up to the idea of having a staycation. To meet this, Colliers sees the possibility of developers using REIT proceeds to buy international brands or create their own homegrown brands.
The REIT Law was passed in 2009 but regulatory obstacles has discouraged developers from investing in them. With most of these challenges out of the way, Colliers calls on developers to optimize their assets for REIT listing.