Published on 20 October 2012 [
manilatimes.net ]
Written by MADELAINE B. MIRAFLOR
The country’s biggest real estate
companies remained to be the main factor why the real estate industry is
experiencing growth where listed property companies represent approximately 15
percent of the market capitalization.
According to the market report of CBRE
Philippines, the listed property companies continue to provide an investment
window to local and foreign investors.
“The Property Sector Index [PSI] as of
March 2012 registered the highest record since 2008 at 1,881.71 and is
equivalent to a P/E [price to earnings] ratio of 23.15 times, still within
tolerable levels,” said the report.
CBRE Philippines also mentioned the
companies that contributed largely in the industry: Ayala Land Inc.; SM Prime
Holdings; and Robinsons Land Corp.
“The aggressive development thrust of
Ayala Land provides large and sustainable income generating projects that
supports a share price upside to investors,” said CBRE Philippines.
“In the property sector, SM
Development Corp. [SMDC], the mid-income residential development arm of SM
Land, is aggressively developing condominiums across Metro Manila including
Tagaytay City. This, coupled with determined land banking strategy, shows
promise of unprecedented growth for SMDC,” it added.
The profitability of Robinsons Land,
on the other hand, continues to rise on the back of improved revenues across
all its business segments and led by its commercial and residential divisions.
This runs contrary to its undervalued share price of a low P/E ratio of 10.3x
as of end 2011 and rising to 15.3x by the first quarter of 2012.
CBRE Philippines, moreover, specified
that the second quarter turned out to be another encouraging period as the
local real estate sector remained among the best performing markets in the
region.
“Developers are actively pursuing
projects and more big ticket developments are being lined up in the sectors of
residential, office, hospitality and retail. Consistent with their expansion
plans, developers are aggressively working on the acquisition of land which
would be included in the ranks of active projects,” said the report.
Also, developers are keen on utilizing
their existing land banks as the timing is very suitable for developments from
the favorable market conditions, CBRE noted.
Investments are still concentrated in
the business districts of Makati City and Bonifacio Global City in Taguig City,
though developments are becoming more active in the fringe areas. Bonifacio
Global City, on the other hand, still has vacant developable lands and still
interests developers because of its location, the market report said.
CBRE is the world’s largest real
estate services provider and the leading player in the local market that has a
network of offices in Asia Pacific and the United States.
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