2015 is upon us. What does the forthcoming year herald for the property industry? According to experts, the market for real estate is poised for further growth, thanks to several key factors.
Like retail, the tourism industry is also on the rise. A thriving tourism sector spells good news for property development, operations, and investment. Take a look at why tourism is counted as a key factor in real estate prosperity below.
An advisory firm, CBRE Asia Pacific reported that the tourism industry will spell profit for the property sector. From 2010 to 2020, the Philippines is projected to enjoy a 5.7 percent year-on-year rise in international tourist arrivals(1), the highest in the Southeast Asian region, according to the United Nations World Tourism Organization (UNWTO).
Additionally, the Department of Tourism (DOT) recorded 884,014 visits to the country from January to February 2014(2). With almost 30,000 more visitors, it was an increase of roughly 3.5 percent over the number of visits during the same period last year, said the DOT. The government seeks to welcome up to 10 million tourists by 2016, according to KMC Mag Group, who recommends newer and larger airports to accommodate this figure.(3)
To this end, developers have mobilized in erecting hotels and tourist destinations, not to mention a range of establishments and facilities for the service and hospitality industries. Buoyed by strong investments, luxury hotels reportedly contributed 2,308 rooms in 2014, a figure that CBRE expects to rise to 6,877 within the next four years.
The biggest projects include PAGCOR’s Entertainment City. Spanning eight square kilometers of land, the reclaimed area will be home to five integrated gaming resorts. Among them, Solaire Resort & Casino and City of Dreams Manila are operational. Meanwhile, Manila Bay Resorts is set to open in 2015. Resorts World Bayshore is scheduled for completion in 2018.
Like the retail industry -- which, by nature, necessitates a sector under property development -- tourism necessitates the developments that serve to house and fuel this industry. In turn, the Philippines’ rising popularity as a tourist destination should buoy property demand in the coming year.
Finally, in the next article, take a look at how investment ratings make the coming year enticing for real estate activity.