MANILA – Iloilo’s residential market remains primarily horizontal (house and lots), but international real estate management company Colliers is seeing a growing attractiveness in condominium living especially in the city’s major business district.
Iloilo’s residential market is primarily horizontal with about 22,000 units at the end of 2018. Meanwhile, there are only about 2,170 vertical or condominium units at the end of 2018.
Iloilo City’s condominium stock remains small compared to the horizontal segment, but Colliers sees a more aggressive launch and completion schedule moving forward given the rising viability of condominium living, especially within the city’s main business district. From 2019 to 2021, the firm expects the completion of about 500 condominium units per year. This is higher than the 470 units delivered annually from 2016 to 2018.
The bulk of the new supply from 2019 to 2021 is likely to be within Iloilo City’s business district. Colliers sees Megaworld’s Iloilo Business Park accounting for about 54 percent of the new units during the period. Among the property developer’s projects due to be delivered during the period are Saint Honore and The Palladium, the first upscale development in Iloilo with an average price above P6 million. Other notable projects include Ayala Land’s Avida Towers, Sta. Lucia’s Soto Grande Iloilo, and Filinvest Land’s One Spatial.
Iloilo City is part of Western Visayas, which is one of the fastest growing regions in the Philippines. According to the Philippine Statistics Authority (PSA), Western Visayas’ economy expanded by 6.1 percent in 2018. The services sector, which covers outsourcing activities and stokes demand for modern residential accommodations, accounts for about 58 percent of the region’s economy, followed by the industrial sector (e.g. manufacturing and construction) which covers 25 percent of the region’s annual economic output. Economic activities in Iloilo continue to thrive, making it a residential hotspot in the region.
In 2018, economic projects with prices ranging from P450,000 to P1.7 million accounted for 50 percent of total horizontal take-up. This is higher than the segment’s 34 percent share in 2017. The affordable segment’s share reached 48 percent. Colliers see economic and affordable units driving the demand for Iloilo City’s house and lot segment in the next three years.
In the condominium market, about 400 condominium units were taken up in 2018, up from 350 in 2017. From 2019 to 2021, we project an annual take-up of about 400 units. The affordable segment accounted for 53 percent of total take-up in 2018 followed by the mid-income category. From 2019 to 2021, Colliers expects these segments to continue driving condominium demand.
Overall, Colliers says condominium units in the city remain an attractive investment option for overseas Filipino workers (OFWs). However, OFWs choose to live in house and lots around the peripheral areas of Iloilo’s business district as they still prefer to own individual lots with large open spaces for their families, the company explained in its report.
Outside of Iloilo City, areas such as Pavia, Laganes and Sta. Barbara remain attractive for house and lot projects. Colliers forecasts developers acquiring more parcels of developable land in these thriving residential sites./PN