PHILIPPINE REAL ESTATE and RELATED NEWS in and around the country . . .
.
.

Osmeña: Cebu's SRP realty practices

Wednesday, June 11, 2008
By Antonio V. Osmeña
Estatements


THE inhabitants of Cebu, who are co-owners of the pet project of Mayor Tomas Osmeña, which is the South Road Properties (SRP), are concerned on which project practices SRP will undergo whether in subdividing or in development.

Unfortunately, in practice, the terms subdividing and developing are used interchangeably. Possibly it might be an honorable decision on the part of Mayor Tom to have a consensus of the combined skills of urban planners, architects, civil engineers, real estate consultants and financiers—all cooperating to execute an effective planning and which must merit the sanction of its inhabitant co-owners.

Literally interpreted, subdividing merely means the “breaking-up of one or more large tracts of land into smaller sites or plots.” When subdividing is the owner’s intent, he need not incur any additional expenses other than those incidental to the purchase, reclaim and survey of the land. It also includes the placing of markers or stakes at intended plot boundaries and to submit a surveyor’s “plat” of the proposed subdivision.

It should be noted that the process of subdividing, as explained above, does not require any physical change in the land “per se.” Whenever land improvements are carried out in accordance with subdivision plans, and expenditures are being made to provide essential site facilities, the field actions are appropriately classified as land developing.

The process of developing is ordinarily far more comprehensive in its scope than that of subdividing and requires expenditures greatly in excess of those represented by the price of the “raw” land.

Developing, to be socially, politically and economically successful, should be practiced only by the well-informed, by men who are well acquainted with community space requirements, population and real estate market trends, community growth and growth patterns, and the absorption rate at which building sites in newly formed subdivision can profitably be sold.

Generally, developers are men with long years of experience in the real estate profession or men who are guided by real estate analysts, civil engineers or consultants, who have specialized in the highly complex field of land utilization. An analysis of development costs reveals that the sale price of a site in an average development must yield three to four times the cost of the “raw” land if the undertaking is to prove financially successful.

Subdividing as the first step in the developing program requires the application of the economic concept of highest and best use to the area as a whole and to each site under development, in particular.

Highest and best use is defined as the present and prospective legal use which will yield the highest present value of the land. It is one problem to determine the highest and best use of a given site, and a much more intricate problem to determine the highest and best use of a great number of interrelated sites or for the development as a whole.

The price of “raw” or reclaimed land at the SRP is a major factor to consider since the investor-developer will need to undertake the development of water mains, sanitary sewers, street grading and asphalt paving, curbs and gutters, electrical posts and other costs.

These other costs include surveying, legal fees, filing fees, sales, brokerage and overhead expenses.

Would Mayor Tom be kind enough to present to the people the latest master plan of the SRP?

______________________________________________________________________

real estate central philippines
Copyright ©2008-2020