philippine real estate market 3q 2012

8/13/2019 PHILIPPINE REAL ESTATE MARKET 3Q 2012

1/14

PHILIPPINE REAL ESTATE MARKET

RESEARCH & FORECAST REPORT

www.colliers.com

MARKET INDICATORS

OFFICE

RESIDENTIAL

RETAIL

3Q 2012 | MARKET OVERVIEW

Executive SummaryThe Philippine economy posted a growth of 5.9% in 2Q 2012. The services sector was the main

contributor, accounting for 4.3 percentage points of the total GDP growth. Meanwhile, remittances

from OFWs reached US$13.7 billion as of YTD August (+5.4%). This has consistently fuelled

domestic consumption backed by benign inflation and low mortgage lending rates of 5% to 8%.

Driven by the 6.1% growth in the first half of this year, analysts forecasts were recently upgraded

to range between 5.0% and 5.5% for the year.

In the next two years, Metro Manila office stock will exceed the seven million sq m mark as

developers anticipate sustained demand from the O&O industry. Particularly, new supply isexpected to be at over 500,000 sq m in 2013, an increase of 28% YoY and a new historical

high. Meanwhile in the Makati CBD, total office stock increased to over 2.75 million following the

completion of Zuellig Building (57,000 sq m).

In the first nine months of 2012, new supply of high-rise residential condominiums in the five

sub-markets tracked by Colliers reached almost 5,000 units. Majority of these are located in Fort

Bonifacio. In the Makati CBD, the stock is unchanged at 15,513 units since March of this year.

Other upcoming completions include Raffles Residences (237 units), Greenbelt Madison (276

units), and The Grand Midori Tower 1 (279 units). Both the Makati CBD and Fort Bonifacio will

have the strongest supply pipeline in the next two years.

In the first nine months of this year, Metro Manila new retail supply reached over 60,000 sq

m. This is owed to the completion of Magnolia Town Center in Quezon City and the partial re-

launch of Glorietta 1 and 2 in Ayala Center. There are roughly 400,000 sq m of super-regional,

150,000 sq m of regional and some 100,000 sq m of district and neighborhood malls currently

in the pipeline. In the long term, retail developments will consistently expand across the untapped

geographic markets in Metro Manila, around BPO and commercial centers, and within the master-

planned communities.

ECONOMY

OFFICE

RESIDENTIAL

RETAIL


2/14

a At constant 2000 price

b Agriculture, Hunting, Forestry, Fishing

c at constant 2006 prices

ECONOMIC INDICATORSa

2007 2008 2009 2010 2011 1Q12 2Q12

Gross National Product (%) 6.10 6.00 6.50 8.40 3.20 5.80 5.60

Gross Domestic Product (%) 6.60 4.20 1.10 7.60 3.90 6.40 5.90

Personal Consumption Expenditure (%) 4.4 4.2 4.6 3.7 2.3 3.4 6.10

Govt Expenditure (%) 6.90 0.30 10.90 4.00 1.00 24.00 5.90

Capital Formation (%) -0.50 23.40 -8.70 31.60 8.10 -23.50 2.30

Exports (%) 6.70 -2.70 -7.80 21.00 -4.20 7.90 8.30

Imports (%) 1.70 1.60 -8.10 22.50 0.20 -2.60 4.40

AHFFb(%) 4.70 3.20 -0.70 -0.20 2.70 1.00 0.70

Industry (%) 5.80 4.80 -1.90 11.60 2.30 4.90 4.60

Services (%) 7.60 4.00 3.40 7.20 5.10 8.50 7.60

Average Inflationc(%) 2.9 8.3 4.1 3.9 4.6 3.1 2.90

Budget Deficit (Billion Pesos) (P12.4) (P68.1) (P298.5) (P314.4) (P197.7) (P33.9) (P573.0)

P:US$ (Average) P46.1 P44.7 P47.6 P45.10 P43.31 P43.30 P42.80

Average 91-Day T-Bill Rates (%) 3.40 5.20 4.00 3.70 1.37 1.88 2.33

ECONOMY

The Philippine economy posted a growth of 5.9% in 2Q 2012. Regionally, the countrys economic growth outperformed that of Malaysia (+5.4%),

Vietnam (+4.4%), and Singapore (+4.2%), and came in third after China (+7.8%) and Indonesia (+6.4%).

The services sector was the main contributor, accounting for 4.3 percentage points of the total GDP growth. It grew by 7.6% in the second

quarter which has been attributed to the development of the following subsectors: Real Estate (+19%), Renting and Business Activities (+9.8%)

and Ownership of Dwellings (+2.1%). Similarly, government spending on infrastructure facilitated this growth as it increased by 45.7%.

Meanwhile, remittances from OFWs reached US$13.7 YTD August (+5.4%). This has consistently fuelled domestic consumption backed by

benign inflation and low mortgage lending rates of 5% to 8%. Other supporting fundamentals in the second quarter include employment

(+2.8%), and tourist arrivals (+7.0%).

Driven by the 6.1% growth in the first half of this year, analysts forecasts were recently upgraded to range between 5.0% and 5.5% (previously

4.5% and 5.0%) by year-end, well within the governments target of 5.0% - 6.0%.

P. 2 | COLLIERS INTERNATIONAL

PHILIPPINES | 3Q 2012 | THE KNOWLEDGE

OFW Remittances

-

5,000

10,000

15,000

20,000

25,000

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

InMillionUSDollars

1Q 2Q 3Q 4Q

Source: Bangko Sentral ng Pilipinas

* as of August 2012


3/14

LAND VALUES

Implied land values in the Makati CBD appreciated by 1.5% in the third quarter to average at PHP289,100 per sq m. This translates to an

accommodation value of PHP18,069 per sq m. In Ortigas, land values have been consistently appreciating at a modest rate, currently 1.0% this

quarter, with the average land value pegged at PHP132,000 per sq m. In BGC, land values sustained double-digit growth on an annual basis,

resulting in an average accommodation value of PHP23,500. The forecast for both Makati and BGC land values are seen to increase between

8% and 9% by the third quarter next year.

COMPARATIVE LAND VALUESPESO / SQ M 3Q12 2Q12 % CHANGE (QoQ) 3Q13F % CHANGE (YoY)

MAKATI CBD 280,100 - 298,100 272,170 - 297,100 1.57 290,312 - 338,951 8.83

ORTIGAS CENTER 99,399 - 166,032 98,434 - 164,420 0.98 105,250 - 176,200 6.03

BGC 195,000 - 275,000 155,500 - 229,647 5.60 195,000 - 315,000 8.51

Source: Colliers International Philippines Research

LICENSES TO SELL

Overall residential licenses issued by the HLURB in the first seven months of this year expanded by 24.5%. The latest figures indicate that

119,357 units were licensed as of July, up by around 76,512 units compared to the same period last year. Noticeable rises were seen in the

high-rise residential (+77.2%) and low-cost housing segments (+15.9%). Meanwhile, the number of licenses in the socialized housing segment

started to improve since the decline in May, however in sluggish increments, up by just 5.9%. In contrast, licenses in the middle-income

horizontal housing segment depicted lingering depression which resulted in a contraction of 23.8%. The same segment has decelerated at

double-digit rates since March of this year. The decline is believed to be due to an increase in vertical development positioned towards the middle

income segment.

In Metro Manila, over 50,000 high-rise residential licenses were issued in 2011. Roughly around 82% are in the middle-income segment. This

translates to a standard contract price of PHP1.25 million to less than PHP5.0 million. In the first half of 2012, licenses remain geared towards

the same segment or approximately 78% of the 37,000 units issued. The most recent of these were Arezzo Place by Phinma Properties (2,160

units), The Pearl Place by RLC (1,367 units), Amaia Skies Avenida North Tower (1,167 units), and Paseo De Roces by Federal Land (1,044 units).

Makati CBD, Ortigas & Fort Bonifacio Average Land Values


-

100,000

200,000

300,000

400,000

500,000

3Q97

3Q98

3Q99

3Q00

3Q01

3Q02

3Q03

3Q04

3Q05

3Q06

3Q07

3Q08

3Q09

3Q10

3Q11

3Q12

3Q13F

pesospersq

uaremeter

Makati CBD BGC Ortigas Ctr




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HLURB LICENCES TO SELL

UNITS JAN - JUL JAN - JUL % CHANGE YoY

2012 2011

Socialized Housing 21,375 20,178 5.9

Low-Cost Housing 28,972 24,995 15.9

Middle-Income Housing 15,723 20,626 -23.8

High-Rise Residences 53,287 30,070 77.2

Commercial Condominiums 1,357 460 195.0

Farm Lots 51 60 -15.0

Memorial Parks 70,933 99,018 -28.4

Industrial Subdivisions 0 30 -100.0

Commercial Subdivisions 399 437 -8.7

Total (Philippines) 192,097 195,874 -1.9

Source: Housing and Land Use Regulatory Board

OFFICE SECTOR

Supply

In the next two years, Metro Manila office stock will exceed the seven million sq m mark as developers anticipate sustained demand from the

O&O industry. Particularly, new supply is expected to be at 500,000 sq m in 2013, an increase of 28% YoY and a new historical high. A large

majority of these new office spaces are dedicated BPO facilities.

Meanwhile in the Makati CBD, total office stock increased to over 2.75 million following the completion of Zuellig Building (57,000 sq m). Other

projects in the pipeline are Alphaland Makati Tower (38,400 sq m), V-Tower (23,000 sq m) and the Glorietta 1 and 2 BPO buildings (27,000 sq

m). Office buildings that have been likewise delivered in the third quarter are Net Lima (51,000 sq m) in Fort Bonifacio, and Aseana One (30,000

sq m) in Pasay. While developable land in the major CBDs are constrained, construction activities are expected to build-up around the fringes

of Ortigas, Makati, and in other pocket developments in Pasay and Quezon City.

HLURB Licenses

Source: Housing and Land Use Regulatory Board

-

20,000

40,000

60,000

80,000

100,000

120,000

140,000

-

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

2Q99

4Q99

2Q00

4Q00

2Q01

4Q01

2Q02

4Q02

2Q03

4Q03

2Q04

4Q04

2Q05

4Q05

2Q06

4Q06

2Q07

4Q07

2Q08

4Q08

2Q09

4Q09

2Q10

4Q10

2Q11

4Q11

2Q12

units

Quarterly Approvals (LHS) Moving 12-Month Average (RHS)




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Makati CBD vs. Metro Manila Office Stock


0

100,000

200,000

300,000

400,000

500,000

600,000

-

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

1990

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2002

2003

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2005

2006

2007

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2011F

2012F

2013F

insq.m.

insq.m.

Metro Manila Stock Makati CBD YoY Change (RHS)

0%

2%

4%

6%

8%

10%

12%

14%

16%

-

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

1990

1991

1992

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1994

1995

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2001

2002

2003

2004

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2009

2010

2011

2012F

2013F

insq.m.

Metro Manila Stock (LHS) Makati CBD (Stock) ( LHS) Total Stock YoY Change (RHS)

OFFICE SECTOR

Demand

In 3Q12, the premium vacancy rate in Makati spiked to 7.6%, from the 2.1% registered in the previous quarter. The increase was mainly due to

the remaining inventories in the Zuellig Building. Despite this, the overall rate was narrowed due to the drop in vacancies across Grade A and B

offices, by 2.0% and 3.1%, respectively. The outlook on vacancy is that it will decrease at slightly above 3% in the next twelve months while

demand gradually picks up.


Makati CBD Office Supply and Demand

-5%

0%

5%

10%

15%

20%

(80,000)

(30,000)

20,000

70,000

120,000

170,000

220,000

270,000

1989

1990

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2012F

2013F

insq.m.

New Supply During Year (LHS) Take-Up During Year (LHS) Vacancy at Year End (RHS)


PHILIPPINES | 3Q 2012 | OFFICE


6/14

MAKATI CBD COMPARATIVE OFFICE VACANCY RATES (%)

3Q12 2Q12 3Q2013FPREMIUM 7.62% 2.12%

GRADE A 2.03% 3.46%

GRADE B & BELOW 3.19% 4.47%

ALL GRADES 3.55% 3.99% 3.10%


FORECAST OFFICE NEW SUPPLY

LOCATION End-2011 2012 2013 2014 TOTAL

MAKATI CBD 2,699,696 57,353 87,837 - 2,844,886

ORTIGAS 1,145,350 - 75,127 22,800 1,243,277

FORT BONIFACIO 592,272 166,989 136,884 193,796 1,089,941

EASTWOOD 292,819 35,765 - - 328,584

ALABANG 265,552 18,889 10,040 36,843 331,324

OTHER LOCATIONS* 766,369 117,693 196,483 266,415 1,346,960

TOTAL 5,762,058 396,689 506,371 519,854 7,184,972


*Manila, Pasay, Mandaluyong and Quezon City

Rents

Rent in Makati CBD remains on an upward trend. Premium rental rates grew by 0.8% and exceeded the PHP900 per sq m average. This will

grow by 7% in the next twelve months. Grade A and B rents rose by 0.7% and 0.5% to PHP730 and PHP500 per sq m, respectively. Both grades

may increase by 5% in the next twelve months. Meanwhile, in BGC, despite the substantial supply next year, rental rates are seen to grow

modestly between 3% to 4%.

COMPARATIVE OFFICE RENTAL RATES (PESOS/SQM/MONTH)

MAKATI CBD (BASED ON NET USEABLE AREA)

3Q12 2Q12 % CHANGE (QoQ) 2Q 13F % CHANGE (YoY)

PREMIUM 855-950 840-950 0.8 8701,060 6.9

GRADE A 560-900 550-900 0.7 595-940 5.1

GRADE B 450-550 465-530 0.5 458-595 5.3





7/14

Capital Values

Currently, prices for premium units are now pegged at an average of PHP123,050 per sq m and will grow by 6.3% in the next twelve months .

On a quarterly basis, capital values for both Grade A and B offices grew by 1.2% to PHP84,400 and PHP57,450 per sq m, respectively. Both

grades will increase by almost 5% in the third quarter of next year.

COMPARATIVE OFFICE CAPITAL VALUES (PESOS / SQM)

MAKATI CBD (BASED ON NET USEABLE AREA)

3Q12 2Q12 % CHANGE (QoQ) 3Q13F % CHANGE (YoY)

PREMIUM 118,000 - 128,100 115,800 - 126,113 1.7 121,200 - 133,665 3.6

GRADE A 71,015 - 97,794 70,173 - 96,634 1.2 73,790 - 101,380 3.8

GRADE B 49,298 - 65,600 48,810 - 64,700 1.2 49,810 - 67,300 1.9



Makati CBD Office Capital Values

30,000

50,000

70,000

90,000

110,000

130,000

150,000

3Q00

1Q01

3Q01

1Q02

3Q02

1Q03

3Q03

1Q04

3Q04

1Q05

3Q05

1Q06

3Q06

1Q07

3Q07

1Q08

3Q08

1Q09

3Q09

1Q10

3Q10

1Q11

3Q11

1Q12

3Q12

1Q13F

3Q13F

inpeso

persq.m.

Premium Grade A Grade B/B-




8/14

RESIDENTIAL SECTOR

Supply

In the first nine months of 2012, new supply of high-rise residential condominiums in the five sub-markets tracked by Colliers reached almost

5,000 units. Majority of these are located in Fort Bonifacio. In the third quarter however, project completions were minimal. These were

Eastwood Le Grand 1 (558 units) in Eastwood City and Tuscany Private Residences (380 units) in Fort Bonifacio.

In the Makati CBD, the stock is unchanged at 15,513 units since March of this year. Other upcoming completions include Raffles Residences (237

units), Greenbelt Madison (276 units), and The Grand Midori Tower 1 (279 units). Both the Makati CBD and Fort Bonifacio will have the strongest

supply pipeline in the next two years. Together with the other major districts, new supply will be at 7,600 units in 2013, but will decline by 50%

the following year.

Makati CBD Residential Stock

-5%

0%

5%

10%

15%

20%

25%

-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

3Q00

1Q01

3Q01

1Q02

3Q02

1Q03

3Q03

1Q04

3Q04

1Q05

3Q05

1Q06

3Q06

1Q07

3Q07

1Q08

3Q08

1Q09

3Q09

1Q10

3Q10

1Q11

3Q11

1Q12

3Q12

1Q13F

3Q13F

inunits

Residential Stock (LHS) YoY Change (RHS)


FORECAST

RESIDENTIAL NEW SUPPLY

End-2011 2012 2013 2014 TOTAL

MAKATI CBD 14,735 1,553 2,825 875 19,988

ROCKWELL 3,718 - - 441 4,159

FORT BONIFACIO 12,714 3,053 3,450 1,276 20,493

ORTIGAS 9,870 1,117 934 792 12,713

EASTWOOD 5,735 1,095 440 278 7,548

TOTAL 46,772 6,818 7,649 3,662 64,901



PHILIPPINES | 3Q 2012 | RESIDENTIAL


9/14

MAKATI CBD

COMPARATIVE RESIDENTIAL VACANCY RATES (%)

3Q12 2Q12 3Q13F

LUXURY 4.6 5.0

OTHERS 11.1 12.8

ALL GRADES 10.3 11.8 10.1


Rents

Rents for luxury 3-BR condominiums have been trending upward over the last three years. Premium 3-BR rental rates in the Makati CBD grewby 15% annually and are pegged at PHP710 per sq m on average. This translates to a monthly rate of PHP177,500 for a 250 sq m unit. Premiumrates for both the Makati CBD and BGC are almost the same and will improve modestly by 5% to 6% in the next twelve months due to theconsiderable upcoming supply. In Rockwell, where supply is limited, Premium rental rates grew 5% YoY to an average of PHP790 per sq m. This

is seen to exceed PHP800 per sq m per month in the next six months.

Demand

Residential vacancy in the Makati CBD slightly decreased by 1.55% QoQ. Despite the limited completions in the last six months, vacancyremained at double digits, currently at 10.3%. Still, the bulk of the remaining inventories (lease and sales) consist mainly of studio and one-bedroom units.

In 3Q12, both Premium and Grade B vacancies were stable at below 5% and 15%, respectively. In contrast, Grade A vacancy dropped by 2.8%to 8% QoQ. In the next twelve months, besides Raffles Residences, new stock will be wholly Grade A residential condominiums. This suggeststhat vacancy for the same segment may increase by 4% at the most in 3Q13. On the other hand, Grade B vacancy is seen to decrease to 8%while Premium vacancy will remain stable.

Makati CBD Residential Vacancy

2%

4%

6%

8%

10%

12%

14%

16%

18%

3Q98

1Q99

3Q99

1Q00

3Q00

1Q01

3Q01

1Q02

3Q02

1Q03

3Q03

1Q04

3Q04

1Q05

3Q05

1Q06

3Q06

1Q07

3Q07

1Q08

3Q08

1Q09

3Q09

1Q10

3Q10

1Q11

3Q11

1Q12

3Q12

1Q13F

3Q13F





10/14

METRO MANILA RESIDENTIAL CONDOMINIUM

COMPARATIVE LUXURY 3BR RENTAL RATES


MAKATI CBD 525-890 520-875 1.45 538-973 5.85

ROCKWELL 677-900 675-900 0.14 712-945 5.07

BONIFACIO GLOBAL CITY 568-850 562-828 2.05 577-935 6.60


COMPARATIVE RESIDENTIAL LEASE RATES

THREE-BEDROOM, SEMI-FURNISHED TO FULLY FURNISHED

MINIMUM AVERAGE MAXIMUM

Apartment Ridge / Roxas Triangle

Rental Range * 100,000 150,000 250,000

Average Size ** 210 280 330

Salcedo Village

Rental Range 65,000 95,000 135,000

Average Size 170 190 330

Legaspi Village

Rental Range 65,000 190,000 250,000


Rockwell

Rental Range 150,000 200,000 300,000


Fort Bonifacio

Rental Range 75,000 160,000 280,000


Source: Colliers International Philippines Research* in pesos per month

** in square meters

Makati CBD, Rockwell, Bonifacio Global CityPrime 3BR Units Residential Rents

-

100

200

300

400

500

600

700

800

900

3Q01

1Q02

3Q02

1Q03

3Q03

1Q04

3Q04

1Q05

3Q05

1Q06

3Q06

1Q07

3Q07

1Q08

3Q08

1Q09

3Q09

1Q10

3Q10

1Q11

3Q11

1Q12

3Q12

1Q13F

3Q13F

inpesopersq.m.permonth

Makati CBD Rockwell Bonifacio Global City





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METRO MANILA RESIDENTIAL CONDOMINIUMS

COMPARATIVE LUXURY 3BR CAPITAL VALUES (PESOS / SQ M)


MAKATI CBD 78,950-153,150 78,936-151,922 0.5 81,350-161,257 6.2

ROCKWELL 99,902-147,489 98,913-141,816 2.8 101,850-160,002 5.9

BONIFACIO GLOBAL CITY 91,293-141,387 90,658-136,746 2.4 92,705-155,500 6.7


Makati CBD Residential Capital Values


60,000

70,000

80,000

90,000

100,000

110,000

120,000

130,000

140,000

3Q01

1Q02

3Q02

1Q03

3Q03

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3Q04

1Q05

3Q05

1Q06

3Q06

1Q07

3Q07

1Q08

3Q08

1Q09

3Q09

1Q10

3Q10

1Q11

3Q11

1Q12

3Q12

1Q13F

3Q13F

inpesopersq.m

.

Makati CBD Rockwell Bonifacio Global City

Capital Values

Capital values for premium residential condominiums in the Makati CBD and BGC are currently the same at PHP116,000 per sq m. BGC

secondary prices will eventually increase by 6.7% in 3Q13 and will be closely followed by Makati by 6.2%. In Rockwell Center, rates are peggedat PHP123,695 per sq m and will increase by 5.9% in the next twelve months.

COMPARATIVE RESIDENTIAL LEASE RATES (EXCLUSIVE VILLAGES)

3BR - 4BR, UNFURNISHED TO SEMI-FURNISHED

LOW HIGH

Forbes Park 250,000 550,000

Dasmarinas Village 200,000 450,000

Urdaneta Village 180,000 450,000

Bel Air Village 100,000 300,000

Ayala Alabang Village 85,000 300,000

San Lorenzo Village 80,000 280,000





12/14

ro Manila Hotel Room Stock

RETAIL

Supply

In the first nine months of this year, Metro Manila new retail supply reached over 60,000 sq m. This is owed to the completion of Magnolia TownCenter in Quezon City and the partial re-launch of Glorietta 1 and 2 in Ayala Center. Despite the increase, the recently demolished Ever GrandCentral (21,700 sq m) resulted in a reduction of retail stock to settle at 6.7 million sq m of leasable space.

In the long term, retail developments will consistently expand across the untapped geographic markets in Metro Manila, around BPO andcommercial centers, and within master-planned communities. Moreover, retail complexes are likewise anticipated to roll out in the upcomingEntertainment City in Pasay. There are roughly 400,000 sq m of super-regional, 150,000 sq m of regional and some 100,000 sq m of districtand neighborhood malls currently in the pipeline.

Besides shopping malls and complexes, a substantial number of superstores have also been widely introduced. These are mainly supplied bymajor retail chain owners such as Puregold Price Club Inc., SM Prime, and Rustans Super Centers, Inc. In Metro Manila, there are over 80superstores at present which are estimated to amount to 420,000 sq m. This segment is expected to expand further while the amount of large-scale developable land becomes limited coupled with the heightened consumer interest in this retail format.

RETAIL STOCK

METRO MANILA (SQ M)


SUPER-REGIONAL 3,051,353 3,051,353 0.00 3,051,353 0.00

REGIONAL 1,115,378 1,115,378 0.00 1,245,378 11.66

DISTRICT / NEIGHBOURHOOD 1,103,011 1,065,734 3.50 1,103,011 0.00

ALL LEVELS 5,269,742 5,232,465 0.71 5,399,742 2.47


Demand

Due to tightened competition, major retail players are moved to reinvent plans and upgrade from traditional retail set-ups. On top of thenumerous introductions of local and international brands, mall expansions and continuous refurbishments are progressively done to furtheraccommodate more tenants and eventually intensify foot traffic. These on-going reconstructions have resulted in a temporary reduction in theoccupancy rates. Together with the inclusion of new supply, vacancy rates on both super-regional and regional malls rose to 3.17% in the 3Q12or an occupancy rate of 96.8% from the 98.6% in the previous quarter. Vacancy rates are expected to narrow simultaneous with the re-openingof new mall spaces towards the holiday season.

METRO MANILA

COMPARATIVE RETAIL VACANCY RATES (%)

3Q12 2Q12

SUPER-REGIONAL 3.00 1.23

REGIONAL 3.63 1.56



PHILIPPINES | 3Q 2012 | RETAIL


13/14

Rents

Rental rates in Ayala Center increased by 1.6% to an average of PHP1,270 per sq m. Meanwhile, rental rates in Ortigas Center marginallyimproved by 0.6% to about PHP1,095 per sq m. Rental rates in both districts are projected to grow by 3% - 4% in the next twelve monthssupported by the robust consumer spending.

Ortigas Retail Rent


0%

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1Q10

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P

hp/sqm/month

(Ortigas) Month ly Rent (Ortigas) YoY Inc rease (RHS)

Spending Indicators

During the first nine months of this year, total vehicle sales grew by 2.4% annually to 111,586 units. However, on a quarterly basis, it contractedby 3.8% and fell short by 1,556 units. The decline in sales mainly occurred in August when the severe flooding on top of fewer workingdays hampered sales activities. The Chamber of Automotive Manufacturers of the Philippines Inc. (CAMPI), however, sees sustained strongperformance for the remainder of the year. The inflows of new vehicle models backed by a positive economic outlook were cited as the maingrowth drivers.

Quarterly Vehicle Sales

Source: Chamber of Automotive Manufacturers of the Philippines

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

-

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

1Q0

4

3Q0

4

1Q0

5

3Q0

5

1Q0

6

3Q0

6

1Q0

7

3Q0

7

1Q0

8

3Q0

8

1Q0

9

3Q0

9

1Q1

0

3Q1

0

1Q1

1

3Q1

1

1Q1

2

3Q1

2

Car Sales YoY Change (RHS)


PHILIPPINES | 3Q 2012 | RETAIL


14/14

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Julius GuevaraAssociate DirectorAdvisory & ResearchMain +632 888 9988 ext. 4024FAX +632 845 2612Email [email protected]

David A. YoungManaging DirectorColliers International PhilippinesMain +632 888 9988FAX +632 845 2612

Email [email protected]

Copyright 2011 Colliers International.

The information contained herein has been obtained from sources deemedreliable. While every reasonable effort has been made to ensure its accuracy,we cannot guarantee it. No responsibility is assumed for any inaccuracies.Readers are encouraged to consult their professional advisors prior to actingon any of the material contained in this report.

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