Philippine Real Estate News – April 2016

real estate news 43 p

hello everyone,

here’s some select articles about Philippine Real Estate and our economy from various newspaper correspondents that matters for your reference.

from Philippine Daily Inquirer’s correspondent, Charles E. Buban :

DCIM100GOPRO

7th heaven property rises in Bicol

When money is no object—you must have at least P42 million to have a chance to be part of this proposition—and you long for an insanely lavish island living, then you should be talking to Andrew Sparrow, CEO of Blue Development Inc. and development director of Ugen, a soon-to-rise luxury masterplanned real estate development in Calintaan Island in Matnog, Sorsogon.

“Where do you go when extravagant just isn’t enough? In this project, you will have the chance to luxuriate in one of our 100 Hillside and Beachfront Modular Villas just steps from ethereal pink sand beach some 800 meters long. At the same time, the island also allows you to explore its numerous pristine beaches, go spelunking in its famous cave; visit marine sanctuaries and hidden isles nested by migratory birds. If you want to explore further, we will provide you with the most convenient way to visit Mayon Volcano in Albay; swim with the famed whale sharks of Donsol; explore the 250-meter Busay Falls in Malilipot, Albay; ride the 320-meter zipline in Ligñon Hill Nature Park also in Albay; go bird watching in Pili’s Eco-Village, wetlands in Cabusao, or Mt. Isarog; or relax amid the serene lake of Mt. Bulusan. Indeed, Ugen is set to be the new millionaire’s outdoor playground,” described Sparrow.

To give one an idea where this development is located, Calintaan island is about half an hour away from the port of Matnog (where one also catch a Ro-Ro (roll on, roll off) to Allen, Northern Samar). The island faces to the east San Bernardino Straight and is sheltered from the Pacific Ocean’s oftentimes harsh waves.

First phase

Ugen’s first phase, which spans 5 hectares out of the project’s 10-hectare total area, will already include construction of a beach club, tree-house bistro, lake deli, marine life sanctuary, yacht dock, game room, helipad, and water sports facilities.

“The growth in numbers of the ultra wealthy has driven demand for life on a tropical island. For these select few, it is the ultimate trophy asset. But more importantly, our clients are seeking the ultimate hideaway. For them, the qualities remote and private are priceless,” said Sparrow.

According to him, Ugen will offer personalized residences —only 67 units will be available —in lots 1,000 to 2,100 square meters in size.

While the 1,000 sqm lot sizes will be “made to measure” meaning, the owners will just select from existing design layouts, those who will opt for the lots sized 1,400 and over will be “bespoked” wherein the owner could fully customize the unit’s design.

Sparrow shared that his group has tapped the services of renowned Filipino designer

Antonio “Budji” Layug and architect Royal Pineda to design these ultra high-end residences that will highlight the country’s architectural heritage.

Ugen will also offer 100 modular hillside and beachfront villas that will be available in sizes 350 and 500 sqm. Each of these villa will be designed and constructed by Blue Development consultants to afford buyers a full turn-key experience.

Ultra wealthy individuals

“We anticipate more second- or third-generation ultra wealthy individuals, accustomed to money and who are becoming more interested in having those with more lasting impact, to play an important role in our latest endeavor,” said Sparrow who has been developing real estate for over 25 years, and more specifically yield-based residual assets over the last 12 years. He is also part of the team of international experts responsible for the design and development of Anya Resort and Residences, a world-class resort in Tagaytay City, and other five-star resorts and residences throughout the Indian Ocean, Caribbean and Central America.

Sparrow added that investors now bid that they stay in and enjoy places which not only give them the luxuries and personal experiences they demand, but also respect and give something back to the local environment.

Sparrow said: “In conceiving this place, we have involved all the people of the island. We will not only make them partners of this development but also our agents to make sure the island’s resources will be protected. In fact, we will take advantage of the island’s wealth of sun, wind and waves by building renewable alternatives to carbon fuels.”

The islands receive significant solar radiance and extensive winds so why not take advantage of it?” asked Sparrow.

from Business World’s correspondent, Victor V. Saulon :

German firm eyes more projects in PHL

solar

GERMAN COMPANY Conergy is pursuing projects in the Philippines with a total capacity of 180 megawatts (MW) starting in the third quarter this year after completing eight solar farms in Luzon and the Visayas as of the first quarter of 2016

“It’s a number of big projects. It’s mainly in Luzon and some in Mindanao,” said Alexander Lenz, president of Conergy’s Asia-Pacific unit, in a press briefing on Wednesday.

This comes as Conergy finished installing a total of 274 MW of solar capacity in the country, which it claims to amount to more than half of the 500-MW quota for solar photovoltaic plants that could qualify under the Department of Energy’s (DoE) feed-in tariff (FIT) scheme.

Mr. Lenz declined to disclose the exact number of new projects that the company was negotiating to build, only saying these were below five. He added he was looking at three or four investors.

“We are very positive for the further development of the solar sector in the Philippines and we would like to benefit from our position if new business comes up,” he said, adding that the country will remain an important market for Conergy.

Based on the company’s project completion record, the proposed solar farms should be completed by the first quarter of 2017. Some of the companies behind these projects are those that Conergy has partnered before, Mr. Lenz said.

Of the 274-MW capacity installed by Conergy thus far, 201 MW were sealed by the company only in 2015. Their completion as of March 15 should count them among those vying for the fixed tariff of P8.69 for each kilowatt hour they export to the distribution or transmission grid.

These projects are located in different areas in the Philippines in areas spanning between 213,292 and 634,514 square meters. Four of them are in Luzon — 50 MW in Tarlac, 13 MW in Pampanga, 15 MW in Bulacan and 18 MW in Bataan.

The rest of the solar farms are in Negros — 14 MW in La Carlota, 48 MW in Manapla, 18 MW in Bais and 25 MW in Silay.

Conergy said that together with its local partners, it was able to add clean electricity capacity to the grid and further strengthened its position as the leader of solar engineering, procurement and construction services in the Philippines.

“We’d like to keep our position, which will be difficult enough if you look at the market share that we have. But we are very positive that this is not the end of solar development in the Philippines but only the beginning,” Mr. Lenz said.

He said Conergy expects “continued strong upside” for solar in the Philippines and that it was awaiting an announcement from the DoE for a third phase of solar FIT in the second half of the year.

Mr. Lenz said that even if the next phase of tariff would be lower than P8.69/kWh, solar projects would remain a viable venture for investors in the energy sector. The first batch of solar projects, with a total capacity of 108.90 MW, were offered a fixed tariff of P9.68/kWh.

In terms of capacity, the biggest solar farm installed by Conergy is the 50-MW Tarlac Solar Power Project (TSPP) in Bulacan that was inaugurated on March 3. The project is with PetroSolar Corp., which is owned by PetroGreen Energy Corp. and EEI Power Corp.

“We are proud to have been able to deliver this project in four and a half months, a record not only for our company but for solar farm execution in Southeast Asia, in general,” Mr. Lenz said.

The farm covers 55 hectares of industrial land within the Central Technopark in Tarlac City. It is expected to serve 31,700 households with clean electricity, which will replace at least 47,800 tons of carbon dioxide emissions every year, Conergy said.

In the Visayas, the biggest solar project installed by the company is the 48-MW project with Negros Island Solar Power, Inc. — a joint venture between the Philippine Investment Alliance for Infrastructure, a fund managed by Macquarie Infrastructure Management (Asia) Pty. Ltd., and Bronzeoak Philippines.

Mr. Lenz said Conergy was also looking at a few partners in solar rooftop projects with an estimated total capacity of 10 MW.

from Malaya.com :
Moodys 2

MOODY’S: PH BETTER THAN MOST NEIGHBORS

Credit rating agency Moody’s Investors Service recognized the country’s macroeconomic profile, giving it a “moderate +” rating which is better than select neighboring countries.

The macroeconomic profiles of China, India, Indonesia, and Thailand were assessed a tad lower at “moderate,” while that of Vietnam was four steps lower at “Weak -”.

Moody’s describes macroeconomic profiles of countries within a scale ranging from “Very Weak –” to “Very strong +”.

Moody’s said it expects the Philippines’ economic stability to help the country “sustain  a robust growth and stay resilient to external shocks.”

Amando Tetangco, Bangko Sentral ng Pilipinas Governor, commenting on this latest development, said “despite a challenging global backdrop, the Philippines has managed to keep its macroeconomic environment relatively stable over the years on the back of prudent monetary policy and sound banking supervision.”

“External risks, including contrasting monetary policies in advanced economies and lackluster global growth, make the job of central banks tougher.  As the Philippines aims to build on its economic gains from the past half a decade, the BSP will help maintain an enabling environment by staying committed to its mandate of price and financial stability,” Tetangco added.

Moody’s explained that when assessing a sovereign’s macroeconomic profile, the credit rating agnecy takes into account a host of factors, including economic strength, institutional strength, susceptibility to event risks, and credit conditions.

Also, Moody’s uses a country’s macroeconomic profile, which describes the operating environment for corporate entities, as one of the bases for rating banks.

In a report published March 18 and which provided an overview of the Philippines’ macroeconomic condition, Moody’s said: “The Philippines remains among the fastest growing major economies in the Asia-Pacific region.”

It added that it expects the economy to grow by 6 percent in 2016, faster than the 5.8 percent recorded last year.

“The country’s strong growth results from the continued strength of domestic consumption – fueled by a combination of improving employment conditions at home and relatively stable overseas remittances – as well as healthy public and private-sector investments,” Moody’s said.

The credit rating agency said its relatively favorable assessment of the Philippines’ macroeconomic profile is “backed by robust economic growth, comfortable external liquidity, and improved institutional strength.”

On institutional strength, Moody’s mentioned the important role played by the BSP in helping maintain a stable macroeconomic environment.

“The country’s institutional strength has also improved, driven in part by an increasingly credible track record of policy effectiveness by a number of national agencies, especially the central bank,” Moody’s said.

Moody’s Investors Service says that the growth outlook of Asean economies is likely to diverge in 2016 and 2017, against the backdrop of subdued global demand.

“The growth prospects of Asean’s major export-orientated economies — Singapore, Malaysia and Thailand –will remain weaker than those of more domestic demand-driven economies, Indonesia and the Philippines, in 2016 and 2017,” says Rahul Ghosh, a Moody’s Vice President and Senior Research Analyst.

Vietnam (B1 stable), meanwhile, will remain a regional growth outperformer on the back of robust manufacturing activity and strong foreign direct investment flows.

Export growth is slumping across the region; however, the overall economic impact will vary based on the relative importance of trade to GDP.

According to Moody’s, total trade — the sum of exports and imports — accounts for 346 percent, 131 percent and 130 percent of GDP in Singapore (Aaa stable), Malaysia (A3 stable) and Thailand (Baa1 stable), respectively, which is much higher than the 41 percent recorded for Indonesia (Baa3 stable) and 58 percent for the Philippines (Baa2 stable).

“Singapore, Malaysia and Thailand are susceptible to a prolonged period of subdued global demand via both the export channel and weaker investment demand,” says Ghosh.

“We forecast G20 GDP growth at 2.6 percent in 2016, similar to last year and rising to only 2.9 percent in 2017. And downside risks to global growth are increasing,” adds Ghosh.

Ghosh was speaking on Moody’s just-released edition of Inside ASEAN, which also examines the implementation of major policy reforms in Malaysia, which have mitigated the negative impact of lower oil prices on the government’s fiscal position.

Moody’s notes that external pressures — including increased capital flow volatility and consequent exchange rate depreciation — have led to a deterioration in Malaysia’s growth and external metrics thereby supporting Moody’s earlier decision to revise the sovereign rating outlook to stable from positive.

Moody’s last December maintained its stable outlook on the Philippines “given (the country’s) strong economic fundamentals and relatively stable policy outlook.

Moody’s currently rates the Philippines at Baa2, a notch above investment grade.

Moody’s said the Philippines, and other members of the Asean-5 and India, will continue to remain shielded from external shocks specifically those involving foreign exchange and monetary policy.

“While export weakness and capital outflows are credit negative, currency flexibility combined with respective governments’ ongoing efforts to improve macroeconomic conditions offsets these trends,” Moody’s said.

Moody’s said exports were weak last year across the region, but currency pressures were strongest for commodity exporters Indonesia and Malaysia.

Moody’s added they do not expect a significant fiscal boost to growth either, particularly in the case of Indonesia and the Philippines, where the track record suggests that large-scale public investment may be difficult to implement.

Reviving growth, the report said, will be a priority in 2016, “but given skittish markets, the desire to sustain investor confidence will keep governments from unleashing stimulus that would raise macroeconomic imbalances.”

The Philippines, as reflected by the investment grade ratings, reflects the resilience of the economy to the current slowdown affecting countries in the Asian region, Moody’s earlier said.

Moody’s said that the Philippines’ Baa2 rating reflects the resilience of its economy to the current headwinds buffeting neighboring countries and emerging markets as a whole.

Further, the stable outlook reflects Moody’s expectation that positive economic and fiscal trends will be sustained over the next 1-2 years.

from Manila Bulletin’s correspondent, Bernie Magkilat :

israelph p

Israeli Firms explore tie-ups, Investments in Philippine Agriculture

Major Israeli agriculture companies are further exploring partnerships with Filipino firms as they looked at the Philippines as its next hub for agriculture including the production of high quality seeds and crops, research and development and technology transfer in the region.

Israeli Ambassador to the Philippine Effie Ben Matityau said the increased interest among Israeli companies in the country is expected to boost bilateral trade between the two countries which currently stood at $250 million, which still exclude business undertaken by MNCs as they conduct their businesses through various levels and industries.

According to Matityau, the Israeli agro-business delegation consists of eight companies dealing with irrigation, aquaculture technology, poultry equipment and supplies, seeds and propagation materials, and post-harvest treatment.

The companies are Agrotop Ltd., Bermad, BioFishency Ltd., Eshet Eilon, Metzerplas Cooperative Agricultural Organization Ltd., Netafim Ltd., ShneorSeed Ltd., and Tefen Flow and Dosing Technologies.

Gilad Peled, director of the Israel Export and International Cooperation Institute and head of the Israeli delegation, said the trade and economic mission is composed of eight major agriculture and agriculture-related companies are in the country to look for partners and distributors for joint venture arrangements. This is already the second mission organized by the Israeli-government institute in one and half years.

“The Philippines has become a destination for us to create partnership,” said Peled, who described the delegation members as “strong and mature companies serving a huge global market but have seen huge potential in the Philippines.”

He explained that they are concentrating on bringing the mature and big companies because it would be easier for them to open the gates to pave the way for the entry of Israeli SME firms in the future.

“They are all looking for partners and distributors and then take that step further,” he added.

According to the Ambassador, there are currently over 100 Israeli companies doing business in the country but most of them are into the ICT sector and are working with the country’s main telecommunications providers – Globe and PLDT. There are also big BPO firms with over 1,000 employees.

But agriculture is the next wave of industries that Israel is interested in the country.

“We are only a small country of 8 million population but size is not the issue but quality. With our cutting edge technology, we can help the Philippines adopt our technology and come up with export quality products to the world,” Matityau said.

“But this can only be done with modern technology. With great markets and demand for fresh produce, the Philippines can be a production hub,” he said.

“Our investment is on the transfer of know how because you have plenty of money and can create new economies but how to make use of it is through the adoption of modern agricultural technology,” he said.

Mashab, an Israel government’s agency in charge of capacity building for all industries, have been helping the government adopt its new technology to ensure food security for the Philippines.

Already, Israel has already brought 540 students for an 11-month intensive agricultural on the job training in Israel.

“The Bible defines the land of Israel as the land of milk and honey. However, it is also a land of many extremes, with very limited water resources, scarce arable land and climate conditions far from favorable,” Matityau said.

“‘Necessity is the mother of all inventions’ is Israel’s formula to deal with the many challenges and the key to our development. Our farmers and scientists work together and develop a highly productive agro-economy with optimal use of water, very efficient irrigation technology and techniques, and unique management systems, all in an impressive production chain,” he adds.

Netafim Ltd.,  global leader in drip and micro-irrigation solutions,  offers a wide range of state-of-the-art irrigation and complementary solutions for agriculture, landscaping and mining. Bermad provides a comprehensive range of solutions and products for the irrigation market around the world. Metzerplas Cooperative Agricultural Organization Ltd. develops and produces agricultural and landscaping products and turn-key irrigation projects.

BioFishency Ltd. has developed an all-in-one water treatment to make highly-effective water treatment accessible and appropriate for widespread use in land-based aquaculture.

from Interaksyon.com :

Electronics-manufaturing

DTI: PH fast becoming regional hub for Electronics Manufacturing

MANILA – The Philippines is fast becoming a regional hub for the manufacture of electronic products and components, with Department of Trade and Industry Secretary Adrian S. Cristobal Jr recently inaugurating the new factory of Kinpo Electronics Philippines at Lima Technology Center in Lipa City, Batangas.

The new facility will manufacture calculators, electronic keyboards and LED lamps.

“New manufacturing facilities in the country represent a strong vote of confidence in our efforts to fast-track reforms and initiatives to attract investments, particularly to further develop our industrial sector.

“Our government’s stable macroeconomic fundamentals and commitment to transparency and good governance has led our country to become one of the fastest growing, most resilient, and increasingly competitive economies in the world. The Kinpo Group has recognized this and seen it fit to set up shop in the Philippines,” Cristobal said.

The Industry Development Program, initiated in 2012 by Cristobal during his term as DTI Undersecretary, positions the Philippines as a regional hub for the assembly of various electronic products or components.

“These electronic products are then exported overseas either to other ASEAN economies as part of the regional value chain, or as finished goods for export to both ASEAN and other economies,” Cristobal explained.

Kinpo plans to build another facility at First Philippine Industrial Park (FPIP), also in Batangas.

It currently employs more than 5,000 workers in the Philippines.

New Kinpo Group CEO and president Yong “Simon” Shen expects his company to hire 15,000 workers once all its planned projects in the country are completed.

He added Kinpo is currently recruiting qualified Filipino engineers for its new facilities in the country.

The electronics industry roadmap is one of the 40 roadmaps crafted under the IDP. Complementing the industry roadmaps are various projects under the Manufacturing Resurgence Program (MRP) and the Investments Priorities Plan (IPP). Through MRP, the country seeks to resolve issues that cut across industries, such as those related to the ease of doing business, transport and logistics efficiency, and cost and supply of power.

Export receipts from the Philippine electronics sector have showed consistent growth, with total figures cornering 41.8 percent of total Philippine exports in 2014.

The industry has emerged as the second largest contributor to the Gross Value added (GVA) in the manufacturing sector.

In a separate development, President Aquino also toured and inspected the new facilities of Kaertech Electronics Philippines, Inc. (KEPI) in Laguna on Thursday, expressing satisfaction with the continuing investments and growth in the electronics sector.

Accompanying Mr. Aquino as he toured the Innorev Building in Phase 6A Laguna Technopark, Inc. (LTI) at the Special Export Processing Zone (SEPZ) in Biñan City, were KEPI President Michael Bouffaut, Trade and Industry Secretary Adrian Cristobal, Jr. and Social Welfare and Development Secretary Dinky Soliman.

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Robert G. Sarmiento Properties
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