Property developer sees positive vibes to continue for RP real estateBy Gil Cabacungan
Philippine Daily Inquirer
Amid scarce land and soaring prices, Federal Land Inc. is primed to make a lot of hay in the ongoing real estate boom with its much-coveted cache property jewels amassed from 40 years of shrewd picking of choice real estate assets in Metro Manila’s financial districts.
“We are optimistic about our prospects in the next few years as real estate growth continues to be centered in the metropolis, and we plan to develop our prime properties into a vibrant township communities,” says Jose Mari Banzon, executive vice president and general manager of Federal Land.
Reeling from the initial public offering (IPO) of its parent GT Capital Holdings last May, Banzon says that Federal Land has the ammunition to turn its idle landholdings from the country’s first commercial district (Binondo, Manila) to the emerging financial hub (Fort Bonifacio Global City).
This year, Federal Land has started construction of its developments in Bonifacio Global City, particularly the prestigious Grand Hyatt/Metrobank building as well as its residential projects. Next year, Federal Land will break ground for its expanded retail and BPO projects in Macapagal Avenue and Fort Bonifacio.
Banzon says that Federal Land remained relatively under the radar among property giants since it built its first high-rise in Manila’s Chinatown in 1972. Its strategy was to first build a reputation as a reliable developer of quality, high-rise buildings in Manila and establish a long-term, after-sales relationship with its buyers. Banzon says the company’s obsession to combine safety, functionality and aesthetics has made a lasting impression on home and office buyers.
“We’re passionate about using only the best local and foreign materials and multiple testing for structural safety. Giving peace of mind to buyers is our main goal.”
After growing as one of the capital’s biggest high-rise developer, Federal Land looked outside Manila for expansion in 2004 when Federal Land president Alfred Ty took over. Federal Land expanded to Makati City (GT Tower, Phil AXA Building and Oriental Gardens), Quezon City, Pasay City, Marikina City, and Global City in Taguig.
Federal Land has since doubled its real estate sales over the last two years and is expected to still maintain this torrid pace until this year.
Banzon brushes off fears that the property market is heating up. Aside from being fundamentally driven by business process outsourcing (BPO) companies looking for more office space and Overseas Filipino Workers seeking to upgrade their homes, Banzon says that property prices are just returning to their levels 17 years ago before the Asian financial crisis. He also points out that the Philippines still has the lowest land prices and rental rates in the region.
“We’re still below Indonesia, Thailand and Malaysia. Forget Hong Kong and Singapore where property prices have always been high. At the current price range, we’re not the most expensive in real terms compared to the pre sub-prime crisis levels,” says Banzon.
The 1998 property bust did the property sector well, according to Banzon, as the market shook off the weak and small players while the strong and big developers wizened up and moved toward self-regulation to prevent another property bubble.
To maximize the positive vibes of the market, Banzon says Federal Land would diversify its portfolio by offering ultra-luxury projects and building more retail space (it will focus on strip malls with the success of its Blue Wave malls) to complement its bread-and-butter, upper middle market products.