Bacolod City is attracting national players and we see this resulting in the development of more masterplanned communities and a further expansion of the city’s residential and office stock.
The entry of national developers is also raising the prices of vertical and horizontal projects, indicative of property firms’ confidence in the purchasing power of Bacolod City’s investors and end-users.
Resurging interest
Interest in Bacolod’s property market is resurging, enticing more property firms to ramp up investments in the city and its environs. It is regaining its stature as a property investment destination, giving developers, investors and end users more reasons to smile.
Bacolod is a highly attractive location for developers given its competitiveness and thriving economy. It also remains a viable expansion hub for a lot of business processing outsourcing (BPO) firms. It should be noted that it is part of Western Visayas, one of the fastest growing and most dynamic regions in the country.
We thus encourage local and national developers to further differentiate especially with the launch of more condominium projects in the city. Property firms should highlight their amenities and continue offering attractive payment options.
Colliers recommends that national developers further assess the viability of Bacolod market for more mid-income and upscale condominium projects. The expansion of the end-user market should also entice developers to launch more mid-income house-and-lot, and lot-only developments.
Assess the viability of mid-income to upscale, luxury projects
Colliers encourages developers to carefully monitor attractive price segments in the pre-selling market. In our view, developers should be proactive in assessing the viability of launching more mid-income (P3.2 million to P6 million) to upscale condominium projects (P6 million to P8 million), especially with the entry of national players in Bacolod.
Meanwhile, developers should further assess Bacolod market’s reception for luxury projects, especially in light of newly-launched residential towers by national developers. In our view, developers are likely to further test higher-income segments over the next 12 to 24 months.
Consider alternative options for house-and-lot developments
While Bacolod City remains the primary site for residential development, Colliers encourages developers to explore alternative sites around the fringes of Bacolod including the Cities of Talisay and Silay. In the first half, these areas accounted for 35 percent of total take-up of horizontal units in Negros Occidental.
Colliers believes that residential demand will also be supported by the development of integrated communities in the city.
Karla Domingo, my colleague from Colliers Philippines’ Advisory Group stressed that “dominance over the Bacolod City residential market is up for grabs. Local and national developers alike should look at pump-priming their respective developments to generate activity and interest in their masterplanned communities. The developer which establishes its location as the new city center will have a great advantage moving forward.”
Office market continues to thrive
Bacolod City has long been a preferred destination for outsourcing firms. The city in fact hosts some of the major BPO companies that have pioneered offices beyond Metro Manila. The city remains attractive given its skilled manpower, competitiveness compared to other hubs outside the capital region, and planned improvement of its infrastructure.
Colliers thus encourages national developers, especially those building integrated communities, to explore the viability of adding office towers to their mixed-use communities.
Tenants should be quick to pre-lease spaces especially within townships and estates where prime offices are likely to be developed from 2022 to 2024.
Our forecast for the Bacolod office remains bullish. As my colleague from Tenant Services, Miguel Bengzon stressed, “home to several of the country’s top call centers and outsourcing locators, Bacolod features the second largest city population in the Visayas and diversified economic growth drivers. The vibrant economy of this highly urbanized and competitive city will continue to generate more investments from real estate developers and occupiers alike, creating more opportunities for livelihood for its constituents.”
There’s no doubt interest in Bacolod is expanding. New office projects and residential communities should benefit end users and investors. For the office market, this is crucial in luring employees back to offices. In the residential market, new upscale and luxury projects mean improved amenities for buyers.
The Philippine economy is likely to grow at a much faster pace in 2022 and this should result in an accelerated expansion of key property investment hubs outside of Metro Manila including Bacolod.