|Trump Tower Manila - The Swimming Pool
The country’s luxury residential market has been picking up in recent years, thanks to a strong economic recovery and increasing demand for rental properties in the capital’s business district as more multinationals have opened offices.
As for the allure of well-known names, the 2008 Nielsen Global Luxury Brands Study ranked Filipinos as the third most brand-conscious population in Asia, a region led by India’s thirst for brands, and ranked eighth globally. The Nielsen survey found Filipino consumers were the most receptive to the idea of designer-branded goods, like mobile phones, laptops and flat screen TVs, and favored brands like Gucci and Louis Vuitton.
|Hammam at the Milano Residences
Century Properties is building the 53-story Milano Residences, where all public areas will be designed and furnished by Versace Home. The project is scheduled to be completed in 2015 but 80 percent of the units have been sold since the project was introduced in December.
The Filipino property developer also recently announced two new branded residential projects, the $150-million Trump Tower Manila and a tower that is not yet named but will be completed with Missoni Home, a first in the residential sector for the Italian fashion brand.
|The Library at the Milano Residences
Robbie R. Antonio, managing director at Century Properties Group, says the strong reception for the Milano Residences encouraged the company to pursue the other branded projects.
The Raffles Residences Makati, which is expected to be completed next year and will share amenities with the Fairmont Hotel, is leading the high-end residential property market in Manila with a current price of $4,600 per square meter.
Brad Berry, vice president real estate at the Dubai-based Kingdom Hotel Investments, which is developing the Raffles project with Ayala Land, says more than 80 percent of the project’s residences have been sold — and that prices have increased on average by 11 percent since the initial introduction, with most of what he called the ‘‘price pressure’’ on the one-bedroom units.
‘‘There is a strong investment play on branded residential, when the offering is supported by an active operating residential brand,’’ he explained. Buyers at the Raffles project can have the hotel arrange rentals when they are not using their properties.
Claro Cordero, head of research, consulting and valuation at the Jones Lang LaSalle real estate agency in Manila, estimates that, after a decline of 7 percent in 2009, prices in the city’s luxury residential market recovered by as much as 14 percent in 2010 and could rise another 10 percent this year.
Mr. Cordero estimates there are about 3,700 completed units that are considered luxury residences in Metro Manila, with about 80 percent concentrated within the Makati central business district. ‘‘For existing luxury developments, the average selling price is approximately $2,950 per square meter, while several upcoming developments are selling at between $3,500 and $4,240 per square meter,’’ he said.
Units at Milano Residences, which range from 40 square meters to 400 square meters, started selling at $2,830 per square meter in December and now are averaging $3,184 per square meter, a 12 percent increase, Mr. Antonio said.
The 55-story Trump Tower Manila, to be completed in 2016, will have 220 units and is set to be one of the capital’s priciest with pre-launch prices at $3,860 to $3,980 per square meter. The 40-story Missoni project, which will be officially introduced in December and should be completed in 2016, will be a smaller project, with units ranging from 25 square meters to 200 square meters, and a starting price of $2,840 per square meters.
So far the majority of buyers in these luxury condominium developments are Filipinos, either living in the country or overseas and seeking either pied-a- terres or investment properties, Mr. Cordero said.
According to a 2010 report by the Washington-based Urban Land Institute and PricewaterhouseCoopers, international real estate investors do not particularly favor Manila. However, within the five real estate investment categories of retail, office, hotels, industrial and residential, residential apartments with the possibility of rental was seen as the best buy.
Mr. Berry said that while overseas and local Filipinos have been driving the market, ‘‘overseas buyers that understand the Manila market can see the upside potential. Obviously that’s why we’ve invested in this market as well.’’
More than 30 percent of the buyers at Milano Residences are from Singapore, Mr. Antonio noted, saying the attributes the interest to their being ‘‘very familiar with the brand and they know what Versace stands for.’’
This story was published in the International Herald Tribune on October 14