The Philippine

PROPERTY MARKET
OUTLOOK

Digital Lead Generation Boot Camp Claro dG. Cordero Jr.

Brentwood Suites, Quezon City 16 February 2016
Outline of the Presentation

Property Market Overview

- Office Market
- Residential Market
- Retail Market
- Hotel Market
Quezon City: In Focus
Property Demand Drivers Outlook and Projection

2
Property Market
MarketOverview
Overview

3
The Rise of Emerging Urban Districts (EUDs)
Continuous Growth in Metro Manila
3 established CBDs
A Makati CBD B Ortigas CBD 1 Bonifacio Global City
20

DPWH: work set New RLC office UP and DLSU

2
for construction of tower to rise in set to open new
21 Sen.Gil Puyat Ave. Ortigas; Ortigas campuses in BGC;
3
5 Underpass Center eyes BPO More businesses
4
24 locators relocate to BGC
6 B 23
8 22
9
11 10
A 1 23 existing EUDs
13 14 12
2 UP Techno Hub 10 Rockwell Center 18 Madrigal Business Park
15
3 Eton Centris 11 Century City 19 Filinvest Corporate City
16
17 4 Eastwood City 12 McKinley Hill 20 Fairview Terraces
5 Araneta Cyberpark 13 SM Mall of Asia Complex 21 UP Town Center
6 Greenhills Redevelopment 14 Metropolitan Business Park 22 Capitol Commons
18
19 7 Rockwell BPO Complex 15 Newport City 23 Frontera Verde
8 Greenfield District 16 Aseana IT Business Park 24 CityPlace Binondo
9 Robinsons Cyberpark 17 Asiaworld City

Source: Various Developers, News Articles, JLL Research & Consulting

4
 2015 at a Glance - Office Market

approximately

712,000
6%
sqm

OF NEW SUPPLY 395,000

Total
Vacancy
from the CURRENT supply of
for 2015
5.6 MILLION
sqm Rental
(2008-2015)
Rates Average
5%
(y-o-y) increase in
Major Business Districts

5
Office Market Overview
Quezon City
Existing supply of office
developments in Quezon City is
around 841,000 sqm. Cumulative Grade A Office Stock in Quezon City
1,600

Quezon City contributes around 1,400

Cumulative Office Supply

1,200

(in thousand sqm)

10% of the total Grade A office 1,000
stock in Metro Manila, which 800

currently stands at 8.3 million sqm. 600

400

Majority of the Grade A office 200

0
supply is concentrated in 2012 2013 2014 2015 2016E 2017E 2018E

Eastwood City. Araneta Center

Eton Centris
Bridgetowne
North Triangle
Eastwood
South Triangle

Quezon City is projected to UP-Ayala Technohub Others

contribute around 16% of the

future supply in Metro Manila.
Note: Existing Grade A office stock is as of 4Q2015.
Source: JLL Research & Consulting

6
2015 at a Glance - Residential Market

Approximately Around 140,000

233,000 units units expected in
completed in Metro Metro Manila until
Manila as of 2015 395,000 2020

216,500 units 27% of households

issued with LTS in in NCR consider the
current quarter (4Q 2015)
2014 in the whole a good time to buy
country housing*

Note: * based on the Consumer Expectations Survey by the Bangko Sentral ng Pilipinas (BSP)
Source: BSP, JLL Research & Consulting

7
Residential Market Overview
Quezon City
As of 2015, there are around 48,000
mid- to high-end condominium units in
Quezon City . Cumulative Mid- to High-End Residential
Condominium Stock in Quezon City
Residential condominiums are 80
concentrated in South Triangle area. 70

(number of units, in thousands)

Cumulative Residential Supply
New developments are being 60

constructed in Districts such as Holy 50

Spirit along Commonwealth Avenue, 40

Balintawak, Bagumbayan, and 30

Diliman. 20

10
By end-2020, total supply of total
0
residential condominium stock 2012 2013 2014 2015 2016E 2017E 2018E 2019E
expected to increase by more than
40%
Note: Existing residential stock is as of 2012.
Source: JLL Research & Consulting

8
Residential Market Overview
Mid-Range to High-End Residential Developments by Price Range PHP 15M up
0%

PHP 7M - 15M
8%
PHP 3M - 7M
45%

PHP 3M - 7M
28%
PHP 1.5M - 3M
PHP 1.5M - 3M 64%
55%

Share per price - 1995 to 2015 Share per price 2016E to 2020E
Notes: (1) Includes only mid-range and high-end residential condominium supply
(2) Figures are rounded off to the nearest tens
Source: HLURB, Various developers, JLL Research & Consulting
9
Residential Market Overview
Mid-Range to High-End Residential Developments by Unit Type

3BR 3BR
4% 5%
Studio
2BR 30%
20%
2BR
31%
Studio
48%

1BR
28% 1BR
34%

Share per unit type - 1995 to 2015 Share per unit type 2016E to 2020E
Notes: (1) Includes only mid-range and high-end residential condominium supply
(2) Figures are rounded off to the nearest tens
(3) Charts only cover approximately half of the existing and future supply in Quezon City.
Source: HLURB, Various developers, JLL Research & Consulting 10
 2015 at a Glance - Retail Market

Manila remains to be 2015 RETAIL

one of the MALL SUPPLY
competitive retail
destinations in Asia
Pacific
15.4 million
395,000 sqm

Aggressive Township
Continued
Developments
Expansion of Foreign
and Local Brands

11
Metro Manila Retail Market Overview
Concentration of Regional Malls in Metro Manila
QUEZON CITY
SAN JUAN Robinsons Magnolia Eastwood Mall
Fairview Terraces Gateway Mall
Greenhills Shopping Center SM North EDSA Industria Mall
Quezon City SM Fairview Vertis North*
Centris Station
MAKATI CITY
Glorietta A-Venue Mall
Greenbelt SM Jazz Mall ORTIGAS CENTER
Century City Mall Circuit Lane
Powerplant Mall Circuit Mall SM Megamall SM Light Mall
San Juan Ortigas
Alphaland Southgate Mall Robinsons Galleria Podium
Pasig Robinsons Forum Paradigm*
Makati Shangri-La Plaza
PASAY Taguig
SM Mall of Asia PASIG
Newport Mall
City of Dreams Manila Pasay Tiendesitas
Estancia at Capital Commons
Paragon at Capital Commons*
ALABANG
Alabang Town Center Festival Mall
TAGUIG
SM City Southmall Alabang SM Aura Premier Market!Market!
Robinsons Las Pinas Bonifacio High Street Venice Piazza
South Park District Mall* Uptown Place Mall*
Venice Grand Canal Mall*
*On Going Developments

Month 00, 2014 12

Retail Market Overview
Quezon City

Existing retail supply (i.e.

shopping malls, hypermarkets,
especiality retail) in Quezon City 2,400
Quezon City Retail Stock
is approximately 2.3 million sqm. 2,350
2,300
Retail supply is concentrated in

Cumulative Retail Supply

2,250

(In thousands sqm)

the SM North EDSA-Trinoma 2,200
2,150
area and Araneta Center due to 2,100

the presence of large shopping 2,050

2,000
malls. 1,950
1,900
By end-2018, total retail supply in 1,850
2012 2013 2014 2015 2016E 2017E 2018E
Quezon City is forecast to grow
by more than 3%

Source: JLL Research & Consulting

13
2015 at a Glance - Hotel Market

Metro Manila As of 4Q 2015, there

continues to be the
are 112 hotels
premiere location with over
for hotel developments
24,500
in the Philippines 395,000 rooms

30 hotels expected to Tourist arrivals

complete in NCR from exhibited 11.7%
1Q 2016 to 2020 adding
more y-o-y increase as
than 12,300 rooms of Jan Dec 2015

14
Hotel Pipeline 2016 - 2020
Makati City Quezon City
1,210 rooms 440 rooms
World Hotel & Residences
Valero Grand Suites Seda Hotel Vertis North
Quezon City
Seda Circuit Makati
Gateway Makati
Mandarin Oriental Manila
Ortigas Center, Pasig City
960 rooms
Newport City Mandaluyong
1,220 rooms Mercure Hotel
Makati
Savoy Hotel Citadines Millennium
Pasig
Hilton Manila Manila Westin Manila Sonata Place
BGC
Sheraton Manila Pasay Taguig Novotel Suites Manila
Paranaque
Bay City/ Manila Bay Area
5,060 rooms
Alabang
Bonifacio Global City
Tryp by Wyndham 1,620 rooms
Admiral Suite Mcollection Shangri-La at the Fort
Manila Bay Resorts Grand Hyatt Manila
Hotel Okura Manila Seda Arca South
The Westin Manila Bayshore Seda Hotel BGC Expansion

15 15
Hotel Market Overview
Quezon City
There are around 2,500 existing
hotel rooms in Quezon City, bulk of
which are present in the South Metro Manila Annual Hotel Supply
5,000
Triangle. 4,500

Estimated Number of Hotel Rooms

4,000
Some of the existing hotels include 3,500
Imperial Palace Suites, Luxent 3,000
2,500
Hotel, and Rembrandt Hotel. 2,000
1,500
Newly opened hotels such as 1,000
Novotel Araneta in Araneta Center 500
-
and upcoming hotels such as Seda 2011 2012 2013 2014 2015E 2016E 2017E 2018E

Hotel in Vertis North is expected to Makati CBD

Manila Bay Area
Bonifacio Global City
Newport City
further increase the supply of Quezon City
Ortigas CBD
Alabang
Bay City / Entertainment City
rooms.

Source: Department of Tourism (DOT), JLL Research & Consulting

16
Emerging Urban Districts in Quezon City

17
Emerging Urban Districts
Quezon City

This section presents the profile of select emerging urban districts in Quezon City, which includes:
1. Araneta Center
2. Eton Centris
3. SM North EDSA
4. South Triangle (select key developments)
5. UP-Ayala Technohub
6. UP Town Center
7. Vertis North

18
Araneta Center
Araneta Center
Description Araneta Center is a mixed-use development that
is being redeveloped. The redevelopment
project aims to refurbish existing establishments
and add various developments such as hotel,
built-to-suit (BTS) office and high-rise
condominiums, among others.
Location Cubao, Quezon City
Developer Araneta Properties
Developments Smart Araneta Coliseum, Gateway Mall, Ali Mall,
Telus House, Gateway Tower , Manhattan
Parkway, Manhattan Parkview Tower 1, Novotel
Manila Araneta Center , Araneta BPO Building
(future), Manhattan Parkview Tower 1&2 ,
Manhattan Heights (future)

Sources: JLL Research & Consulting, Araneta Redevelopment Plan Presentation (February 2013); Developers website

19
 Eton Centris

Eton Centris
Description Eton Centris is a mixed-use development located inside the CBD Triangle
Park. The project features office spaces and a transit-oriented, two-level
commercial center anchored by SM Hypermarket and an interesting mix of
specialty food outlets, specialty stores and service-oriented shops.
Location EDSA cor. Quezon Avenue, Quezon City
Developer Eton Properties
Developments Eton Cyberpod Centris, Centris Walk, Elements at Centris, Centris Station

Sources: JLL Research & Consulting, Araneta Redevelopment Plan Presentation (February 2013); Developers website

20
SM North Residences
SM North EDSA
Description SM City North EDSA primarily
consists of contiguous retail
components. Within the immediate
vicinity of the shopping malls are
residential condominiums and a
future office building.
Location North Avenue, cor EDSA, Quezon
City
Developer SM Prime Holdings(Retail);
SM Development Corp (Residential);
SM Land (Office)
Developments SM City North EDSA, Grass
Residences Towers 1,2 & 3, Fern
Residences Towers 4 & 5 (Future)
SM Cyber West (future)

Sources: JLL Research & Consulting; Developers website

21
South Triangle
South Triangle
Description
South Triangle houses some Grade B/C office developments and two of the most significant
television stations in the PhilippinesABS-CBN and GMA 7. As such, numerous residential,
hotel and specialty retail establishments are present in the area.
Location
Barangay South Triangle, Quezon City
Developers of various projects
SMDC, Megaworld Corporation, Vista Land & Lifescapes, Inc., New San Jose Builders
Developments
Hotel Luxent Hotel, Imperial Palace Suites, Rembrandt Hotel
Residential La Breza Tower, Victoria Towers, M Place South Triangle
(future), Wil Tower 1 (future)
Retail Il Terrazo, Shoppes at Victoria

Sources: JLL Research & Consulting; Developers website

22
UP-Ayala Technohub

UP-Ayala Technohub
Description UP-Ayala Technohub is a mixed-use commercial
complex. Most of the office developments in the area are
built-to-suit (BTS) buildings, servicing primarily
Information Technology (IT) and O&O firms.
Location Commonwealth Avenue, Quezon City
Developer Ayala Land, Inc.
Developments Office buildings A K, retail complex, office buildings
L P, sports hub (future), hotel (future)

Sources: JLL Research & Consulting; Developers website

23
UP Town Center

UP Town Center
Description Located within the citys university
belt, this development features
popular retail stores, unique
restaurant and services for
students, workers and residents in
this community.
Location Katipunan Avenue, Diliman,
Quezon City
Developer Ayala Land, Inc.
Developments UP Town Center Corporate Center
(located within the mall)

Sources: JLL Research & Consulting; News Articles; Corporate disclosure of Ayala Land

24
Vertis North

Vertis North
Description Vertis North is a planned mixed-
use development. The developer
aims to establish a township that
is readily accessible, convenient
and sustainable within a 10-year
period.
Location EDSA, Quezon City
Developer Ayala Land, Inc.
Developments Trinoma, Alveo High Park, Avida
Towers Vita, Vertis North
Corporate Center, and Seda
Vertis North Hotel, an Ayala Mall

Sources: JLL Research & Consulting, News Articles; Developers website

25
Property Demand Drivers
Outlook and Projection

26
 Overseas Filipino Remittances
Boosting household consumption and investments including housing purchases
30 OF remittances reached a total of USD 22.8
billion in 3Q15, higher by 3.6% y-o-y.
25 Remittances have continued to
OF Remmittances (in USD billions)

grow, supporting demand for both

20 retail and housing.

15

10

-
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Jan -
Nov
2015
Source: BSP; JLL Research & Consulting

27
 Tourist Arrivals
Growing tourism sector, growing hotel industry

Tourist arrivals in 2015 continued to grow,

5,000 6,000
reaching 5.36 million, up by 10.9% y-o-y.
4,500
Rising tourist arrivals levels

Tourism Receipts (in USD millions)

Tourist Arrivals (in thousands)

5,000
4,000 fuel demand for hotels.

3,500
4,000
3,000

2,500 3,000

2,000
2,000
1,500

1,000
1,000
500

0 0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Tourist Arrivals Tourist Receipts
Source: Department of Tourism (DOT)

28
 Growing Catchment Market
Increasing population in Metro Manila
13.5
Estimated population in Metro Manila
in 2015 is 12.9 million.
13.0
The rising population boosts demand
Population (in millions)

for housing within Metro Manila

12.5

12.0

11.5

11.0

10.5
2007 2008 2009 2010 2011 2012 2013 2014 2015
Source: NSO, JLL Research & Consulting for the projections

29
Growing Population
Quezon City
3,118,247

Projected Population (2016E)

NCR - 13,184,477

Quezon City has the largest

population among the cities in
Metro Manila.

Source: NSO

30
Planned Infrastructure and Developments
Providing more opportunities in the property market

Project Description Proponents Proposed MRT 7 Route Map

Skyway 14.2-km extension of the existing San Miguel

Stage 3 Skyway project - beginning in Corporation and
Sen. Gil Puyat Avenue, Makati Citra Metro Manila
City, to Balintawak, Quezon City. Tollways
Corporation
Consortium

MRT Line-7 22-km elevated transport system Universal LRT

with 14 stations that will link San Corporation
Jose Del Monte, Bulacan with the (51% owned by San
existing MRT Line 3 at North Miguel Holdings
Avenue, EDSA, Quezon City. Corp)

Source: National Economic Development Authority (NEDA), D.M. Consunji Inc. (DMCI) Holdings disclosure, Citra Metro Manila Tollways Corporation (CMMTC)

31
Planned Infrastructure and Developments
Quezon City Central Business District

The Quezon City-Central Business 5 distinct districts within Triangle Park:

District (Triangle Park) is anchored on (1) Triangle Exchange District
the ideas of the 2006 development (2) Emporium District
framework formulated by the local (3) Downtown Hub District
government and the Urban Triangle (4) Residences District
Development Commission (TRIDEV), (5) Common District
with the help of World Bank.

The QC-CBD is a 250-hectare project planned as world-class mixed-use development which will
feature residential and retail complexes, offices tailored for O&O firms, and heath and wellness
centres. The local government also boasts future strategic transit facilities within the district.

Source: Quezon City local government

32
Property Demand Factors
Opportunities to support further growth

Forecast Outlook

Economy The economy is forecast to grow moderately in the next few

years, which can support further growth of the property sector.
Recent investment grade ratings awarded to the Philippines
may likely attract more investments into the country.
O&O O&O industry is on track to reach USD 25 billion in revenues
by 2016.
The industry is expected to continue driving office demand
moving forward.
Tourism Tourist arrivals continue to rise. The government is targeting 10
million visitors by 2016.
The rise in tourists is expected to fill up the upcoming hotels.

33
Property Demand Factors
Opportunities to support further growth
Forecast Outlook
OF Remittances Remittances are projected to grow at a moderate pace in light
of the ongoing economic struggles in source countries such as
the Middle East and Europe..

Population and Population is expected to continue growing steadily. As more

Household residential developments are being built in Quezon City, this
Income may attract new migrants into the city.
With the growing economy, household income is forecast to
grow as well, boosting residential and retail demand in the next
several years.
Infrastructure Upcoming infrastructure projects are expected to bolster and
provide opportunities in the property market.
The new infrastructure and developments can potentially
expand the target market of property developments.

34
THANK YOU!
Claro dG. Cordero Jr.
Associate Director
Head Research, Consulting & Valuation
claro.cordero@ap.jll.com

Jones Lang LaSalle. All rights reserved. 2016.

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