As the Philippines’ primary industrial hub, the Cavite-Laguna-Batangas (Calaba) corridor continues to attract new and expanding manufacturing locators. This hub’s attractiveness and competitiveness are being further enhanced by the government’s planned and upcoming big-ticket infrastructure projects in the region.
These have also been enticing developers to build more integrated communities and standalone residential projects to cater to rising demand in the region. What stands out for the Calaba corridor is the fact that while condominium projects continue to proliferate, horizontal demand remains robust, especially for Filipinos who are acquiring house-and-lot and lot-only projects for end-use.
Colliers is, in fact, seeing greater demand for horizontal projects as Filipino investors and end-users continue to look for bigger and more open spaces. Its survey also showed that 74 percent of property buyers chose Laguna, Cavite or Batangas for their next horizontal unit investment. Respondents noted that they prefer sustainable features for their next horizontal investment; easy access to essential goods and services; and integrated communities that exhibit the 15-minute city concept.
Pivotal role of new infra projects
As I highlighted previously, infrastructure projects have helped redefine and redirect developers’ expansion strategies.
Key public projects, especially in prime destinations outside the capital region, have provided access to properties that can be redeveloped into massive integrated communities offering a mix of vertical and horizontal developments.
Due to road projects, for instance, business opportunities have spilled over to nearby areas such as Cavite, Laguna, and Batangas. The rise in employment opportunities and private enterprises in the region resulted in the increase of residents’ purchasing power. This eventually resulted in a greater demand for horizontal projects.
Dynamic region for property investments
Cavite, Laguna, and Batangas are part of Region IV-A, one of the most progressive and dynamic regions in the Philippines. In 2023, Calabarzon grew by 5.2 percent, one of the fastest-growing regions in Luzon. In our view, continued regional economic expansion, improving infrastructure network with its spillover impacts, and the residents’ rising purchasing power should help stoke the appetite for residential units in the region.
This is particularly true for lot-only and H&L projects. From 2016 to 2023, Colliers saw a steady increase in horizontal projects in the region. During the period, H&L prices grew by an average of 7.2 percent a year while the lot-only segment saw an annual price increase of nearly 7 percent. For both H&L and lot-only projects, Southern Luzon recorded one of the fastest price acceleration during the period.
Laguna as an attractive option
Colliers sees Laguna as an attractive option among investors and end-users who plan to live and invest in less dense communities, especially given its proximity to Metro Manila.
In our view, the entry of national players in Laguna and the launch of horizontal developments in massive townships have resulted in sustained increase in prices of H&L and lot-only projects in the province. The locale also continues to corner interest from national players that are targeting demand for high end horizontal developments.
Cavite sustaining its competitive advantage
Cavite’s improving connectivity to Metro Manila and the aggressive launch of mixed-use communities should raise land and property values in the province, including horizontal developments. This is also likely to compel developers to launch more horizontal projects that cater to the upscale and luxury segments.
In our opinion, the completion of the LRT-1 Cavite Extension should positively influence horizontal demand in Cavite. Other projects such as the Cavite-Laguna Expressway (Calax) and South Commuter Railway should further stoke H&L and lot-only developments in Cavite.
Batangas’ ability to corner investments
Batangas is viable for more masterplanned projects. Several developers are keenly looking at the province for more horizontal launches. The expansion of industrial activities in the province should further stoke interest in Batangas’ property landscape. Developers should also explore the viability of launching golf communities in the province to take advantage of the rebounding travel and tourism segment.
Batangas is one of the industrial engines of Southern Luzon. And the region’s economy is primarily driven by industrial activities, accounting for 54 percent of the region’s annual economic output. We see more manufacturing investment pledges materializing soon and this will result in greater take-up of industrial space and warehouses. This should contribute to a more vibrant property market here.
Batangas is also part of Southern Luzon, which accounted for 15 percent of total Filipinos deployed for overseas employment in 2022. Hence, we expect more remittances from OFWs flowing into Batangas in the near to medium term. With Batangas being part of this regional economic powerhouse, expect more upscale and luxury horizontal project launches in the years to come.