Promising outlook for thriving Davao
With the growing number of businesses establishments and tourist arrivals coupled with attractive fiscal incentives, the City of Davao continues to look rosy as an investment hub for many real estate developers.
Although the regional economy grew at a slower pace of 8.6 percent last year compared to 10.9 percent in 2017, investors continue to bet big on Davao Region, particularly Davao City.
Conducive for business
Data from the Board of Investments (BOI) showed that in 2018, investment pledges in Davao City reached a record high of P16.2 billion, up by a whopping 221 percent from the P5 billion recorded in 2017. The number of businesses in Davao City also continued to rise, with a total of 41,292 establishments recorded in 2018, up from 40,499 establishments in 2017.
Davao City’s vast land area makes it conducive for the establishment of industrial estates, new growth centers, seaports and economic zones. Property development is one of the 10 preferred business investment areas of Davao City.
The other preferred investment areas are agribusiness, tourism and recreational facilities, light manufacturing and assembly, health and wellness, educational and sports facilities, environment protection or green projects, information and communications technology, generation of new sources of energy, transportation and infrastructure and public-private partnership projects.
Any new enterprise or expansion project within the city identified under the priority areas are eligible to incentives offered by the local government. Businesses with a capitalization of P3 million and up can avail of business tax exemption for three years and real property tax exemption for two years.
Flurry of activities
Davao City has established itself as an attractive destination that has lured a number of property developers, as evident in the flurry of construction activities over the past several years. Data from the Housing and Land Use Regulatory Board showed that 830 licenses to sell were issued from December 1988 to March 2019 in Davao del Sur province alone.
There is, after all, a ready market for real estate projects, whether it’s residential, offices, commercial, hotels and resorts.
Apart from its famed tourist destinations, the declining crime rate, increased connectivity, and completion of proposed big-ticket infrastructure projects may also help boost the city’s attractiveness for firms, residents, and tourists. About 184,000 foreign tourists arrived in Davao City in 2018, while some 2.2 million local tourists visited the city dubbed the “crown jewel of Mindanao.”
Average monthly crime rate in the city fell to 2.5 percent for every 10,000 of population, from 3.9 percent in 2017 and 5.2 percent in 2016. International direct flights to and from Davao City include Singapore, China, Hong Kong, and Doha, which just started in June this year, while direct flights to Japan and Kuala Lumpur from Davao City are being proposed. Flag carrier Philippine Airlines also plans to strengthen its secondary hubs, which include Davao, this year.
The administration’s ambitious infrastructure program and its promise of decentralization also helped put Davao within the radar of local and foreign investors.
Some of the current big-ticket infrastructure projects that will have a direct impact on Davao City include the P40.57-billion Davao International Airport Development Project; P18.7-billion Davao Sasa Port Modernization Project; the P3.25-billion Davao Public Transport Modernization Project; P396.3-million rehabilitation of road networks in Davao City in 2019; and the P61.9-million waste-to-energy facilities.
Promising outlook
Davao City’s promising business outlook also drew in a few foreign hospitality chain brands such as Dusit International, which opened the upscale dusitD2 Hotel this year.
Even before fully opening its doors to the public, dusitD2 Hotel even bagged the Best Hotel Interior Design during the 7th Annual PropertyGuru Philippines Property Awards.
Adjacent to dusitD2 is Dusit International’s first residence in Asia—Dusit Thani Residence. Torre Lorenzo Development Corp. (TLDC) and Dusit Thani Philippines Inc. partnered for the development projects.
To be inaugurated in 2021 meanwhile is the 250-unit Citadines Paragon Davao, which will house retail, office and event spaces. Citadines is under the Singaporean lodging company Ascott Limited.
Sources: Inquirer Archives, invest.davaocity.gov.ph, dict.gov.ph, psa.gov.ph, hlurb.gov.ph, dusit.com, citadines.com
