Take me back to Manila
Despite recent unfavorable developments in the economic and political fronts, there remained enough reasons to go back to Manila—especially for investors in the real estate industry.
Manila ranked 18th in a global index that identifies urban economies and real estate markets seen undergoing the most rapid growth over the short term.
This was according to the “Short-Term City Momentum Index (CMI) of 2018: Agility, Talent and Technology” by professional services and investment management firm JLL.
The cities of Hyderabad, Bangalore and Ho Chi Minh City took the top three spots while Manila bested key cities including Jakarta (23rd), Kuala Lumpur (24th), Singapore (26th), Dubai (27th) and Bangkok (28th).
JLL said in the report that Manila, along with Jakarta, Kuala Lumpur and Bangkok, was identified as among the Asian “megahubs” that act as regional gateways and have the scale to compete for talent, visitors and innovation. These cities are seen to continue driving forward on the back of significant economic momentum.
“Offering substantial growth potential, these cities are key expansion markets for many corporates and are drawing particular interest from Chinese companies as they internationalize. They also have some of the highest levels of real estate completions across the globe as they build out the infrastructure to service this demand,” JLL further explained.
JLL Philippines’ head of research and consulting Janlo de los Reyes added: “These cities made the cut because they are now considered key expansion markets for many corporates and are drawing particular interest from Chinese companies. They also boast of the highest levels of real estate completions across the globe as they build out the infrastructure to meet this demand.”
Two elements
The 2018 edition of the CMI assessed 131 established and emerging markets based on several factors such as weighted index of population, gross domestic produce, corporate presence, air connectivity, real estate investment activity and commercial real estate stock.
For this first time, the CMI focused on two separate elements of city dynamism namely short-term market momentum and “future-proofing” for longer-term success.
Two separate rankings were included—one for Short-Term Momentum and another for the Future-Proofing index, which looked into the qualities cities require to manage and benefit from the rapid technological shift in the global economy.
New indicators in the CMI 2018 include the number of technology “unicorns” created in each city and the quality of public transport infrastructure.
Asia’s rapid growth
Meanwhile, the Short Term CMI further highlighted the continued rise of Asia Pacific cities as destinations for global capital, commerce and innovation, with markets from the region accounting for 25 of the Global Top 30.
Jeremy Kelly, director for global research at JLL, was quoted in a statement as saying that Asia Pacific cities “continue to experience phenomenal rates of change as they serve expanding domestic economies and act as gateways to the world’s fastest-growing region for global investment and trade.”
“However, rapid growth can also lead to issues such as strains on infrastructure, affordability constraints and environmental degradation,” Kelly warned. “In order to maintain growth over the longer term, Asia Pacific cities will need to focus on future-proofing their markets through improved livability and affordability, regulatory transparency and physical and technological infrastructure.”
JLL Philippines country head Christophe Vicic reportedly echoed the same sentiment.
“It’s always good when there is economic and industry growth. But as with any success, it comes at a price. It would mean higher infrastructure requirements, and a government that is keen on adapting technologies that will cater to these cities long-term,” he had explained in a statement.
“Manila is no exception. We are already experiencing strains on our airports, major roads and public services. The city must adapt to the rate of its own growth for the latter to be sustainable,” Vicic added.
