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Thinking about investing in the country’s long-time top central business district? Know more of how Makati manages to continue leading the pack
Since the 1970s, the city of Makati has been considered the Philippines’ leading financial center, and presently one of the most prominent cities in Southeast Asia. To some degree, this has allowed Makati to be self-sustaining, as it remains the preferred location of numerous multinational corporations and prestigious local companies in the country.
The city is also one of the most highly developed in the Philippines, with its comprehensive urban amenities a significant draw for home seekers. Suffice to say, Makati is a coveted address,with many reasons as to why it continues to lead Metro Manila’s business districts in that regard.
Proximity to Anything and Everything
Makati is the current home of over 60,000 commercial and retail establishments, those of which were majorly responsible for the city’s 2014 income of Php12.79 billion. A true lifestyle center, places to spend and do business are not only what’s in Makati. It is also home to 160 schools, 14 hospitals, 29 schools, 10 places of worship, and nine premiere residential communities.
The modes of transportation in Makati are also some of the most comprehensive. Residents and visitors are able to go in, out, or around the city vie e-jeep routes, the PNR train station, UV Express vans, and buses with routes coming in or around Makati, and the MRT train stations.
A True Global City
Makati also serves as the location of 54 foreign embassies and 34 consulates. Additionally, the city hosts 19 international organizations, including the United Nations, UNICEF, and the UNDP.
The Business processing outsourcing (BPO) and information technology (IT) sectors have arguably been the leading contributors to foreign investment in the country, and Makati has not been one to be short on BPO offices, with a current total of 274 offices in the city. On the other hand, seven major IT companies also currently call the city their Philippine home.
High Investor Confidence
The presence of numerous commercial establishments, consulates and embassies, schools, offices, and medical institutions continues to encourage property investment in the city. These, in part, help with the city’s continued overall growth, resulting in significantly high returns.
The 2015 third quarter report by Colliers International has indicated that land values in the Makati CBD has risen by 2.43 percent, hitting an average Php463,700 per sqm. Rental rates for office and commercial spaces, on the other hand, have only slightly lowered, but is still some of the highest in the country, with premium space commanding between Php1,100 and Php1,400 per sqm.
Worsening traffic conditions, which if taken in a different context also means that business is booming and commercial growth is far from dying down, have also contributed to more Makati-based employees looking to live closer to their work. This has kept rental rates in the city stable despite the increase in residential supply resulting from recent completions.
Costs Remain Competitive
While the city of Makati is unquestionably the costliest city to be based in, it is still comparatively more affordable than the other major cities in Southeast Asia, making it a preferred choice for foreign-based investors.
From a residential standpoint, rental rates may have risen to 1.5 percent for the third quarter of 2015, but this rise is welcomed by analysts as it is dispels the rumor of an impending real estate bubble. And as mentioned, Makati is still more affordable when compared to others in Southeast Asia, with stamp duties to be paid in a places like Singapore good enough for the purchase of a condo here.
In a separate Colliers report, Makati is deemed to be the most viable and preferred choice for property investments in the Philippines, as rental rates in its central business district is projected to hover around Php1,309 per sqm in the next two years, and go as far as around Php1,455 per sqm in 2018.
Main photo via Shutterstock
This article was sponsored by Megaworld Makati CBD
Megaworld Corp. is one of the Philippines’ largest property developers. It has an unprecedented track record of completing more than 250 residential buildings, office towers, commercial centers, and world-class hotels since 1994. The company began pursuing priority projects in Makati City, building high-rise condominium towers starting in both Legaspi and Salcedo Villages, now expanding to the other areas located minutes away from the central business district.
