Vista Land unit preps commercial space of Davao condo complex

September 29, 2020 | 12:04 am [ bworldonline.com ]

A DIGITAL rendition of the planned commercial development in Camella Northpoint Davao.

DAVAO CITY — Camella Condominiums, a unit of Vista Land and Landscapes, Inc., is getting ready to develop the commercial component of its five-building condominium complex in Davao City.

“We are almost done with the residential portion and the next phase of Northpoint will be the development of the commercial (space),” Marlon B. Escalicas, COHO by Vista Land head for Visayas and Mindanao, said in a recent interview.

Camella Northpoint, Vista Land’s first condominium project in the city that started development in 2014, is located near several major shopping malls.

“We are going to put as promised, there will be a coffee shop (Vista Land brand) Coffee Project, and retail shops. Since it is nature(-themed), it’s going to be an al fresco type of lifestyle commercial development with retail shops, walkables, restaurants, services, spa,” Mr. Escalicas said.

He added the commercial component will provide an alternative to Camella Northpoint residents as well as non-residents who prefer a less crowded, more open space dining, meeting, and shopping experience.

Vista Land is also planning to build a boutique hotel in the complex, primarily envisioned to serve guests of the condominium residents.

The fifth and last condominium tower is in the final stage of construction with the units scheduled to be turned over to owners before the end of the year.

For the COHO brand, which are medium-rise condominiums with amenities such as a co-working space in a coffee shop and a one-stop home improvement store, Mr. Escalicas said they are pushing sales by positioning these units as “income-generating properties” through leasing opportunities.

“Rental is really very promising. It’s worth your money investing in COHO because it is located in prime locations. Hopefully that will interest the buyers,” he said.

The company has at least four COHO projects lined up in Davao City.

Mr. Escalicas noted the Vista Land group also has its own leasing and housekeeping services which homeowners can tap to manage their units. — Maya M. Padillo

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Single Dwellings and Condominiums Drive Real Estate Prices in Second Quarter

September 29, 2020 | 12:01 am

Senate panel OK’s foreign retailer rules

September 29, 2020 | 12:34 am [ bworldonline.com ]

The Philippines is hoping to attract more foreign retailers with the passage of amendments to the Retail Trade Liberalization Act. — BLOOMBERG

By Charmaine A. Tadalan, Reporter

A PRIORITY measure aimed at further opening up the retail sector to foreign companies hurdled the Senate Committee on Trade, Commerce and Entrepreneurship on Monday, although a local retailers’ group warned this may further hurt micro, small and medium enterprises (MSME) still reeling from the pandemic.

The committee approved Senate Bill (SB) No. 1840, which seeks to amend Republic Act No. 8762 or the Retail Trade Liberalization Act (RTLA) of 2000.

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Under the bill, the minimum paid-up capital for foreign retail investors will be lowered to $300,000. It also requires retailers with more than one physical store to invest at least $150,000 for each store.

The RTLA currently allows foreigners to set up wholly owned enterprises with minimum paid-up capital of $7.5 million, provided investments in each store will be at least $830,000, while enterprises with $2.5 million to $7.5 million will be wholly owned by foreigners except in the first two years.

SB 1840 also removed other qualification requirements such as the $250,000 capital per store for enterprises engaged in high-level or luxury products; the five-year track record in retailing and the required five retailing branches.

The bill also states that only foreign retailers whose country of origin allows entry of Filipino retailers will be covered.

The Department of Trade and Industry (DTI) and major business groups have been pushing for the passage of the measure, along with the bill to amend the Public Service Act, under Commonwealth Act No. 146, saying these will boost foreign investments in the country.

Foreign direct investments (FDI) fell by 23% to $7.647 billion in 2019, which Trade Secretary Ramon M. Lopez attributed to the competitive environment in the region and pending structural reforms.

“(FDIs) are affected, of course, by the competitive environment. In other words, other countries are also trying to invite other investors,” Mr. Lopez said at a Senate hearing on Monday.

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“The other thing is of course, there are structural reforms, we are still supposed to do. For example, on the retail trade, public service act, and of course the tax reform we are trying to do under CREATE (Corporate Recovery for Enterprises Act),” he added.

Mr. Lopez was attending the Senate Finance Committee hearing on DTI’s 2021 budget, during which Senate Minority Leader Franklin M. Drilon asked about the possibility of investors relocating from China.

“There are companies… na lumipat (that relocated) from China and there are more coming. We are not the first choice, I must admit, we’re not getting the biggest, but there are good indications that we are able to attract investments,” Mr. Lopez said.

Under SB 1840, the DTI, the Securities and Exchange Commission, Bangko Sentral ng Pilipinas and the National Economic and Development Authority will review the minimum paid-up capital requirement every five years.

Its counterpart measure, House Bill No. 59, was passed by the House of Representatives in March. The House version proposed to reduce the minimum paid-up capital to $200,000 and the minimum percentage of locally manufactured products to be sold by foreign retailers to 10% from the current 30%.

House Trade Committee Chairman and Valenzuela Rep. Weslie T. Gatchalian said in a phone message he is “amenable to work with the Senate version pushing for $300,000.”

However, Philippine Retailers Association Vice-Chairman Roberto S. Claudio opposed the drastic reduction in paid-up capital for foreign retail investors.

“There can be a compromise to reduce the minimum investment from $2.5 million to possibly $1 million,” he said in an e-mail.

“First, we don’t expose our MSMEs to unfair competition and we get substantial financial investment from foreign investors who will benefit from our market base. Government wants financial investments not market disruptors,” he added.

Meanwhile, the European Chamber of Commerce of the Philippines (ECCP), which is among the 14 business groups that supported the measure, said it supported the House version. 

“While lowering the capital requirements to $300,000 is a step towards the right direction, the ECCP maintains its advocacy of further bringing down the capital requirements to $200,000 in line with the requirements of the Foreign Investments Act,” ECCP President Nabil Francis said in a phone message on Monday.

“By doing so, we can stir healthy competition in the retail industry, which is good for the Filipino consumers, especially the growing middle class, who can purchase a broader variety of goods at lower costs. It is also worth noting that our peers in the region have less restrictive business environments for potential foreign retailers.”

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PHL home prices surge amid pandemic

September 25, 2020 | 6:43 pm [ bworldonline.com ]

Condominium units posted an overall 5.1% price increase in Q2 2017, led by a 7.1% pickup in the provinces and a milder 5.2% increase in Metro Manila. -- BW FILE PHOTO

Home prices surged by a record 27% in the second quarter, driven by strong demand for high-end residential projects and an uptick in costs amid the pandemic-induced lockdown, the central bank said.

The Residential Real Estate Price Index (RREPI) jumped 27.1% year on year in the April to June period, the highest annual growth recorded since the series started in 2016. This was also quicker than the 12.4% hike in the first three months of 2020 and the 0.4% rise in the April to June 2019 period.

The index gauges the average change in home prices across building types and locations and provides the BSP an insight into the property market, bank exposure to which is regulated.

“Banks cited the following reasons for the uptick in real estate prices in Q2 2020:  higher demand for high-end projects, which drove the average price per square meter (sq.m) upwards; and rising prices of construction materials, labor costs and other indirect costs, e.g., higher marketing costs of appraised premium properties,” the BSP said.

The biggest contributor to the rise in housing prices were loans for the purchase of condominium units, particularly in Metro Manila.

Condominium units recorded the fastest price uptick at 30.1% in the April to June period, while prices of single detached/attached houses jumped by 24.1%, reversing the 4.2% decrease last year.

Prices of townhomes and duplexes also increased by 10.8% and 0.8%, respectively in the April to June period.

In Metro Manila, prices of residential homes rose 34.9% with the fastest growth seen in single detached/attached houses (70%), followed by condominium units (36.4%), and town houses (5%).

In the provinces, residential property prices also rose by 18% with the uptick led by single/detached homes (21.1%), followed by townhouses (13.2%), duplexes (5.2%), and condominium units (3.1%).

Residential home prices increased by an average of 6.08% in 2019 against a 2.95% rise in 2018.

LOANS DROPPED

As Metro Manila remained under lockdown for most of the second quarter, residential real estate loans granted by banks dropped 55.2% from a year ago. 

Based on the type of housing units, 62.7% of the loans were granted for the purchase of condominium units, followed by single detached/attached houses (32.1%) and townhouses (4.8%). 

A less dismal outlook for remittance inflows and the slight improvement in the labor market is seen to have a positive impact on the real estate market, said Colliers Philippines Research Manager Joey Roi H. Bondoc.

“Note that OFWs partly drive the demand for mid-income residential units in the country. House and lot projects in urban areas outside Metro Manila also continue to post a decent take up from OFW investors,” Mr. Bondoc said in a note.

Cash remittances rose 7.8% year on year to $2.783 billion in July, marking the second straight month of growth after the slump caused by the pandemic. 

Year-to-date, inflows dropped 2.4% to $16.802 billion. The BSP expects cash remittances to decline by 5% this year due to the coronavirus crisis.

Meanwhile, the jobless rate stood at 10% in July, easing from the record 17.7% in April but still higher than the 5.4% a year ago. The July unemployment rate represents 4.571 million jobless Filipinos, lower than 7.254 million in April, but higher than 2.437 million in July last year.

In August, the central bank eased the real estate loan limit of big banks to 25% from 20% in a move to provide added liquidity for lending to the sector and to lift the economy during the crisis. — Luz Wendy T. Noble

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BSP sets cap on credit card charges

September 25, 2020 | 12:35 am [ bworldonline.com ]

Credit card issuers can no longer charge interest rates of more than 2% a month or a total of 24% a year on unpaid outstanding credit card balances starting Nov. 3, 2020, the central bank said. — REUTERS

By Luz Wendy T. Noble, Reporter

THE central bank approved an annual interest rate ceiling of 24% for all credit card transactions starting Nov. 3.

This means credit card issuers can only charge interest rates of up to two percent a month on unpaid outstanding credit card balances.

“The interest rate cap on credit card receivables aims to ease the financial burden of consumers and micro, small and medium enterprises amid a difficult economic environment caused by the COVID-19 pandemic,” Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno said in an online briefing on Thursday.

The BSP also set the limit for monthly add-on rates for credit card installment loans at one percent.

Credit card issuers also cannot impose other charges on credit card cash advances except for a maximum processing fee of P200 per transaction, the central bank said.

“Based on our data, average annualized interest rate for credit card receivables range from 18% to 58% from January to June 2020,” BSP Director for Supervisory Policy and Research Department Veronica B. Bayangos said in the same briefing.

“Based on the credit card business activity report, the average annualized interest rate for both premium and non-premium as of June 2020 was around 26%,” Ms. Bayangos added.

The cap on credit card charges takes effect on Nov. 3, but will be reviewed by the BSP every six months.

“We are confident that the banks will comply. Because before we issued this policy, we coordinated with our counterparts in the Bankers Association of the Philippines and they supported this policy,” Ms. Bayangos said.

“We also coordinated this policy approach with the Credit Card Association of the Philippines so we do not expect any non-compliance from this policy approach,” she added.

The central bank also said the maximum ceiling on interest or finance charges on credit card transactions is in line with the current low interest rate environment. The BSP’s overnight reverse repurchase facility is at a low of 2.25%.

Under the Republic Act. No. 10870 or the Philippine Credit Card Industry Regulation Law, the BSP has the supervisory authority over all credit card issuers.

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Pag-IBIG Fund to miss 2020 housing loan target

September 22, 2020 | 6:19 pm [ bworldonline.com ]

THE Home Development Mutual Fund, better known by its Pag-IBIG Fund branding, said it does not expect to achieve its loan target this year due to the coronavirus disease 2019 (COVID-19) pandemic.

In a Laging Handa briefing, Pag-IBIG CEO Acmad Rizaldy P. Moti said the P100-billion housing loan target is at risk due to disruptions in lending activity due to the outbreak.

“Ang Pag-IBIG Fund, unfortunately dahil sa pandemya ay hindi natin maabot ang gusto sana nating pautang sa pabahay ay umabot ng P100 billion this year. Pero dahil sa pandemya, mukhang aabot ito sa P60-70 billion (Pag-IBIG Fund, unfortunately because of the pandemic, will not hit its desired level of housing loans of up to P100 billion this year but because of this pandemic, we will hit P60 billion to P70 billion),” he said.

Mr. Moti said the P100-billion target represents a pledge made to President Rodrigo R. Duterte to issue that much in housing loans every year until 2022.

Mr. Moti said the pandemic may also delay a planned increase in member contribution rates. The state-owned housing fund announced last year that it will increase member contribution rates by P50 starting June 2021. Mr. Moti said after consultations with labor and employers’ groups, the delay will push back the collection of the increase.

“January 2022 magiging effective ‘yung pagtaas na yan (This hike will be effective in January 2022),” he said.

“In terms of financial projections and financial strength, kayang-kaya naman po ng Pag-IBIG Fund na i-delay po ito nang up to 12 months (Pag-IBIG Fund can afford a delay of up to 12 months),” he added.

The Pag-IBIG Fund’s net assets grew at the end of August to P640 billion, against P603 billion at the end of 2019. — Gillian M. Cortez

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Amid lockdown, home buyers see appeal of integrated communities

September 22, 2020 | 12:04 am [ bworldonline.com ]

 TOWERING condominiums in Manila are silhouetted by the rising sun in this March 29 photo. — MIGUEL DE GUZMAN/ PHILSTAR

By Arjay L. Balinbin, Senior Reporter

RESIDENTIAL PROJECTS within integrated communities are likely to be most appealing to buyers post-pandemic, property consultancy firms said.

“Colliers recommends that developers highlight projects that are within integrated communities. In our opinion, the pandemic has further emphasized the need to be in an integrated community where unit owners can easily access essential goods and services,” Joey Roi H. Bondoc, senior research manager at Colliers Philippines, said in an e-mail interview last week.

The recent lockdowns to curb the spread of the coronavirus disease 2019 (COVID-19) has made more people aware of the importance of living within communities that also have office, commercial and recreational components.

Mr. Bondoc said developers should highlight features such as sanitation and property management procedures of their residential projects, as these are likely to be among the major considerations of buyers.

He said these efforts will help improve the sustainability of property projects in Metro Manila and boost the Philippine capital’s ranking in the Global Smart City Index.

Manila dropped 10 spots in the Global Smart City Index released by the Switzerland-based Institute for Management Development. The survey showed Manila residents expressed concern over traffic jams, corruption and air pollution.

“An improved ranking should make Metro Manila a viable property investment destination. This is important especially if the government wants to stoke property demand once the pandemic wanes and lockdowns are relaxed,” Mr. Bondoc said.

Claro dG. Cordero, Jr., director and head of research at Cushman & Wakefield, said the ideal cities in the future will need to offer opportunities for “innovations that enhance the quality of living (right balance of sustainable and cosmopolitan lifestyle); working (uncongested spaces and presence of job opportunities); playing (availability of recreational and cultural centers), and learning (talent enhancement and R&D centers).”

Mr. Cordero said cities also need to better utilize technology to make lives better for its residents.

“Investors will increasingly view the role of technology as another factor to consider when investing in a country, urban center or development,” he said via e-mail.

“Technology will have an overarching influence on how cities provide infrastructure support, talent enhancement, culture and diversity, and sustainability and resilience to its citizens. These indicators enhanced by effectiveness and innovation brought about by technology will assist the investors and businesses as they make their choices on where to settle,” he added.

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BIR’s notice of discrepancy reinstated

September 21, 2020 | 12:31 am [ bworldonline.com ]

 BUREAU of Internal Revenue (BIR) building — BW FILE PHOTO

THE Bureau of Internal Revenue (BIR) will now issue a notice of discrepancy to inform taxpayers of their tax deficiencies as part of an audit, replacing the notice of informal conference (NIC).

BIR Commissioner Caesar R. Dulay issued Revenue Regulations (RR) No. 22-2020 dated Sept. 15 amending a provision of RR No. 12-1999 to replace the old notice with the notice of discrepancy to speed up the assessment process.

“No difference, (we) changed the name to be more appropriate because during the informal conference, what happens really is a discussion of findings of discrepancies. So it’s more appropriate to refer to it as notice of discrepancy,” BIR Deputy Commissioner Marissa O. Cabreros said in a text message on Friday.

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As part of the agency’s audit process, a BIR officer records the tax discrepancies of a taxpayer in the initial investigation report.

The notice of discrepancy will be sent to a taxpayer that was found to have tax deficiencies, giving them a chance to explain the discrepancy in their tax returns within five up to 30 days from receipt of the notice. This process is called “discussion of discrepancy.”

“lf the taxpayer disagrees with the discrepancy/discrepancies detected during the audit/investigation, the taxpayer must present an explanation and provide documents to support his explanation,” the BIR said.

Ma. Lourdes Politado-Aclan, a director from the Tax Advisory & Compliance division of P&A Grant Thornton, said the BIR should fully evaluate the taxpayer’s records before the notice of discrepancy is issued.

“We hope that the BIR has fully evaluated the taxpayer’s records prior to the issuance of the notice so that the notice will only include the real possible tax exposure of the taxpayer. Otherwise, the initial five-day period to present which shall not extend beyond 30 days will be too short for the taxpayers,” she said in a text message on Thursday.

Ms. Cabreros said the maximum discussion period of up to 30 days is long enough for taxpayers to explain their side.

“Thirty days is quite long, besides taxpayers are in the best position to explain the discrepancies as the data came from their own documents/books/records,” she said in a text message on Sunday.

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Ms. Cabreros noted taxpayers can request for an extension, but this will be evaluated based on the merits “to force speeding up disposition of cases.”

However, a taxpayer would be issued a preliminary assessment notice if the BIR does not accept the taxpayer’s explanation and he failed to settle the tax deficiencies.

The preliminary assessment notice can also be issued if the taxpayer does not agree with the results. It will be issued 10 days after the discussions have concluded, upon endorsement of the investigating BIR officer.

The new regulation will take effect on Oct. 1 or 15 days after it was published on Sept. 17

The issuance of notice of discrepancy was reinstated in 2018 after it was removed from the BIR’s audit process in 2013.

When the issuance of the notice of informal conference was removed from the assessment process, taxpayers would receive the preliminary assessment notice immediately after BIR officers found enough basis to audit them for tax deficiencies. — Beatrice M. Laforga

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Ayala Land’s AREIT buys office building in Cebu

September 17, 2020 | 12:04 am [ bworldonline.com ]

AREIT, Inc., the real estate investment trust (REIT) of Ayala Land, Inc., has bought an office building in Cebu City using P1.45 billion from the proceeds of its recent public offering.

In disclosures to the exchange on Wednesday, AREIT said it signed a deed of sale with ALO Prime Realty Corp., a wholly-owned subsidiary of Ayala Land, to buy Teleperformance Cebu.

Teleperformance Cebu is a 12-story building located at the Cebu I.T. Park, Cebu City. It has a total gross leasable area of 18,092 square meters that is 100% occupied.

“This maiden acquisition will increase AREIT’s dividend yield consistent with its growth strategy of acquiring prime real estate assets with stable occupancy,” it said.

AREIT is paying quarterly dividends starting this month, where the payout should be at least 90% of its income.

With the acquisition of Teleperformance Cebu, AREIT’s portfolio has expanded to a gross leasable area of 172,000 square meters from nearly 153,000 square meters before the deal.

“The acquisition in Cebu is strategic for AREIT,” Carol T. Mills, president of AREIT, said in the statement. “Most BPOs (business process outsourcing firms) in Metro Manila have expansion sites and operations in Cebu because of its strong talent pool. Like in Metro Manila, Ayala Land has a significant share in the Cebu office market.”

AREIT has paid an initial P290 million to ALO Prime Realty upon the signing of the deed of absolute sale. The balance of P1.16 billion will be paid after the transfer of the building’s Philippine Economic Zone Authority (PEZA) registration to AREIT.

AREIT did a P12.33-billion initial public offering in August to mark the country’s first REIT offering. Prior to the acquisition of Teleperformance Cebu, AREIT’s portfolio consisted of three Makati-based office buildings: 24-story commercial building Solaris One, two-tower mixed-use development Ayala North Exchange and five-story commercial office McKinley Exchange.

As required by REIT guidelines, proceeds from a REIT offering must be reinvested back to the country within a year. AREIT said then it is eyeing other real estate properties in Metro Manila and key regions.

Shares in AREIT at the stock exchange climbed five centavos or 0.19% to P25.70 each on Wednesday. — Denise A. Valdez

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Sta. Lucia touts nature-inspired developments

September 15, 2020 | 12:03 am [ bworldonline ]

STA. LUCIA LAND, Inc. has a lakeside community called The Lake at St. Charbel in Cavite. — COMPANY HANDOUT

URBAN FARMING and gardening have become popular stress relievers amid the pandemic. This has prompted many home buyers to look into properties with green open spaces.

“We have seen how critical it is to have enough space to move around. Social distancing isn’t something we see as temporary. I think this will now become the norm and thus, it is important to live and reside in an area where there’s more than enough space for people to move around, have access to nature and have good air quality to breathe in,” Sta. Lucia Land, Inc. President Exequiel D. Robles said in a statement.

Sta. Lucia Land’s portfolio includes leisure farm lots at La Huerta Farms and Residences in Laguna, and a lakeside community The Lake at St. Charbel in Cavite.

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Mr. Robles said the lake development and farm lots are projects that are “built for and beyond the new normal.”

“Nature or the simple idea of creating your own green space had become a perfect therapy for many individuals while on quarantine. And this is something that we fully understand and long advocated for. This is why we have in our portfolio projects that would allow residents to commune with nature and to some extent, realize their dream of becoming a full-fledged gardener/farmer,” Mr. Robles said.

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Why demand for residential projects outside Manila is rising

September 15, 2020 | 12:04 am [ bworldonline.com ]

MORE home buyers are looking for projects with open spaces, such as Ayala Land, Inc.’s Vermosa estate in Imus, Cavite. — COMPANY HANDOUT

By Denise A. Valdez, Senior Reporter

RESIDENTIAL developments outside central business districts are expected to gain ground as more people continue to practice remote work arrangements and prefer open spaces.

During Lamudi’s roundtable discussion with real estate leaders last week, developers and consultants said they saw a shift in market preference towards areas outside Metro Manila.

“The need to be in a CBD (central business district) is not that important anymore because of work from home,” Raphael B. Felix, CEO of Phinma Property and board chairman of the Subdivision and Housing Developers Association, said in the streamed webinar.

“There’s really a change. I can see the regions happening, (and) a lot of our new projects are in the regions,” he added.

New lifestyle patterns, where people spend more time at home and avoid crowded areas, are seen to continue even when the lockdowns are eased, Colliers Research Manager Joey Roi H. Bondoc said.

He noted several buyers are already eyeing locations outside Metro Manila when looking for second or third residential units. “They’re planning to invest in areas that are less dense,” Mr. Bondoc said.

And property developers are already reacting to this. Tomas P. Lorenzo, president and CEO of Torre Lorenzo Development Corp., said the company is increasing focus outside the capital.

“We’ve also moved forward with developing outside Metro Manila. We really see the next wave (there),” he said.

“Realizing that technology now allows people to work remotely, it means that there will be many people post-pandemic who will consider really living outside (Metro Manila),” he added.

A builder of solar-powered houses, Imperial Homes Corp., observes the same trend. “People are going to areas outside the CBDs,” Imperial Homes President and CEO Emma M. Imperial said.

Colliers’ Mr. Bondoc said aside from the immediate trend now, he expects further growth for residential developments in the provinces in the future, as companies are also growing more keen in spaces outside Metro Manila.

“We’ve been seeing a lot of companies implementing business continuity plans. Those that were Metro Manila-centric initially are now looking at expanding outside of Metro Manila,” he said.

“Eventually, those office requirements would also result in greater residential investments in these areas,” he added.

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SEC strengthens stockholders’ right to inspect corporate records

September 11, 2020 | 5:08 pm [ bworldonline.com ]

Office rental rates are expected to rise this year, due to continued demand from the outsourcing industry.

The Securities and Exchange Commission (SEC) will investigate complaints against companies that refuse to allow stakeholders to inspect or reproduce corporate records.

The SEC issued a new memorandum circular on Aug. 20 to uphold the right of any director, trustee, stockholder or member of a corporation to request copies or excerpts of corporate records for inspection. This right is guaranteed under the Revised Corporation Code of the Philippines.

If such a right is violated, the memorandum said affected individuals may file a complaint with the SEC, through its Company Registration and Monitoring Department or any of its extension offices. Complainants need to pay a filing fee of P10,130.

The SEC considers it a violation if the company refuses to allow a stakeholder to inspect corporate records, fails to take steps to allow access to corporate records, and fails to give a reasonable amount of time to inspect records.

Upon receipt of a complaint, the regulator will investigate the case by summoning the involved respondents to a clarificatory conference.

The parties have an option to settle the matter amicably, but the SEC may still proceed with its investigation and decide on whether the respondents may be penalized.

The sanctions for such violation will be any or all of the administrative sanctions listed in the Revised Corporation Code of the Philippines. These are a P5,000-P1,000 fine per day of violation, a permanent cease and desist order, revocation of certification of incorporation, and dissolution of the corporation and forfeiture of its assets.

While the guidelines aim to enforce the right to inspect and/or reproduce corporate records, such activity is still bound by confidentiality rules under prevailing laws, such as the Intellectual Property Code of the Philippines, the Data Privacy Act and the Securities Regulation Code. — Denise A. Valdez

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Warehouse logistics grows amid e-commerce boom

 Warehouse logistics grows amid e-commerce boom

September 8, 2020 | 12:04 am

PHILSTAR/EDD GUMBAN

By Denise A. Valdez, Senior Reporter

THE WAREHOUSE logistics industry is seen to grow by as much as 9% in the next three years, as the e-commerce boom shows no signs of slowing down.

Property consultancy firm Lobien Realty Group (LRG) noted demand for warehouses has been increasing as retailers shift to e-commerce as consumers prefer online shopping amid the pandemic.

“[T]he logistics industry is one of the luckiest sectors, because there is still growth in that segment, and that’s because of the growth in e-commerce,” LRG Chief Executive Officer Sheila Lobien told BusinessWorld last week.

“Everyone now is somehow forced to buy things online, and warehousing facilities are really needed. The logistics support has to complement the growth in e-commerce,” she added.

Citing an industry study, Ms. Lobien said the logistics sector is projected to grow 8% to 9% annually in the near term, and the rising demand for warehouses is likely to support this expectation.

“In other segments, we don’t see any growth this year. However in that particular segment, yes it’s that high level. Which is good news because it’s still moving, the market is moving,” she said.

Any expected growth will need support from the government, particularly through the continuous rollout of infrastructure projects to improve the country’s road network.

Ms. Lobien said land values in Metro Manila have been doubling in the past five years, which pushed developers to look for warehousing sites outside the capital.

The challenge in this setup, however, is the accessibility of warehouse facilities to both retailers and consumers. Ms. Lobien said the sustained development of road infrastructure in the next five years would be crucial in the growth of the sector.

“The Build, Build, Build project has to be supported, because it will go hand in hand (with the growth of the logistics industry). The country will be more attractive if we have good networks, roads. That’s the challenge,” Ms. Lobien said.

A 2017 survey by the Department of Trade and Industry showed the Philippines had higher logistics costs compared with regional peers Indonesia, Vietnam and Thailand. Logistics costs stood at 27.16% as a percentage of sales.

The government aims to improve this by eliminating red tape and working with the private sector, among other initiatives.

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Ayala firms plan permanent ‘hybrid’ work setup

September 10, 2020 | 12:08 am [ bworldonline.com ]

THE Ayala Group is considering making hybrid work arrangements permanent as it increases its focus on digital transformation for its operations.

In a speech at the Ayala-FINEX Finance Summit held virtually on Wednesday, Ayala Corp. Chairman and CEO Jaime Augusto Zobel de Ayala said the conglomerate is currently evaluating the need for office spaces.

“Over the last few months, we’ve been conducting extensive research and consultations on the feasibility of a hybrid work arrangement for our employees. We’re making this relatively permanent,” he said.

“We’re applying the principle of outcomes-based evaluation and task-based approach with the way we work… We’re beginning to think in concrete terms rather than just in an impulsive and reactionary way,” he added.

Since the start of the coronavirus pandemic in March, companies across the country have been forced to implement work-from-home arrangements to comply with government protocols that restrict mobility.

The Ayala Group had to adjust by allowing the majority of its over 50,000 employees to stay at home, Mr. Zobel said. As of end-August, around 38% of the group’s workforce continue to work from home.

He noted the changing landscape for workspaces is a consideration for its own business, Ayala Land, Inc., which is a major real estate player in the country.

“Reimagining the future of work is just one element of this larger digital transformation journey that’s beginning to take place. As it stands, redesigning the relationship between work and the office already requires a high degree of openness, flexibility and trust in the institution that you’re working for,” Mr. Zobel said.

The Ayala Group formalized its digital transformation in mid-2019 when it established AC Analytics as a data science unit. It also opened a $195-million venture capital fund to scout for startups that it may invest in.

These strides were in congruence with the company’s belief that digital transformation requires more than just adapting new tools and equipment, but also institutionalizing a “mindset of experimentation”, Mr. Zobel said.

Learning from the group’s alternative work arrangements in the past months, the Ayala chief executive said work flexibility does not necessarily lead to a huge drop in productivity.

“I think productivity should not be the key focus at this point in time. It’s too much shift, too much change. Productivity will come at a later stage,” Mr. Zobel said. “I think more important right now is the ability to adjust, to change, and to do it in a healthy way where we are all in a mentally good place.”

The Ayala Group has businesses in real estate, banking, telecommunications and utility, among others.

In the first semester, Ayala Corp.’s net income dropped 79% to P7.9 billion, due to loan loss provisions from its banking unit, suspension of mall operations of its real estate unit, and one-time gains in 2019 from divesting in power and education.

Shares in the company lost P2 or 0.28% to close at P716 each on Wednesday. — Denise A. Valdez

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Ayala Land estates positioned for resurgence

September 8, 2020 | 12:03 am [ bworldonline.com ]

AYALA LAND, Inc. (ALI) believes its estate developments are well-positioned for resurgence after the pandemic.

“We maintain an optimistic view of the future of our estates as these are designed for the long term and are all grounded on sustainability,” Ayala Land Estates Assistant Vice-President Cris Zuluaga said in a statement.

One such development is Vermosa, a 725-hectare mixed-use estate in Cavite. Vermosa, which will have a one-of-a-kind sports complex, “seeks to promote a community with a balanced and active lifestyle” that is important amid the pandemic.

“The potential for growth in this area of Cavite continues to be unmistakable despite the impact of the pandemic to construction and development, but we are now back on track with the easing of quarantine guidelines,” Ms. Zuluaga said. 

Nuvali, a 2,290-hectare eco-city development spanning the cities of Sta. Rosa, Cabuyao and Calamba in Laguna, is expected to become the next business and lifestyle district south of Makati.

ALI is offering commercial lots at Nuvali, particularly in the upcoming commercial districts East Bloc and Lakeside Evozone.

“Soon, confidence will return; economic activities will increase, and so our efforts today are focused on ensuring that our developments are well-positioned for resurgence and remain as strong platforms for growth,” Ms. Zuluaga said.

Other ALI estates include Arca South in Taguig, and Alviera in Porac, Pampanga.

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Real estate repurposing to keep industry afloat through pandemic

 September 4, 2020 | 12:09 am [ bworldonline.com ]

By Denise A. Valdez, Senior Reporter

THE repurposing of real estate assets is seen as key to the survival of the industry as the coronavirus pandemic continues to pull down the Philippine economy.

In a recent prospective report, property consultancy firm Colliers International Philippines said landlords and property owners have to learn to adjust their assets to adapt with changing consumer behaviors.

This would apply differently per real estate category, but generally all would have to consider the evolving consumer needs and financial capabilities.

For the office segment, Colliers said developers must consider building office spaces in non-core locations, as containing the coronavirus outbreak entails limiting mobility and human interaction.

“This is important especially for companies planning to implement a hub-and-spoke model wherein occupiers reduce the reliance of a single headquarters location for a more dispersed occupancy strategy,” the report said.

Developers that have mall leasing in their portfolio might also find it beneficial to convert vacant mall spaces into flexible workspaces, as mall foot traffic remains low due to government restrictions.

For the hotel segment, Colliers anticipates that tourist arrivals would remain dampened throughout the year due to lockdown restrictions. This means hotel operators are likely to hit only 30% occupancy this year.

To adjust, developers are advised to convert leasing spaces into co-living facilities and flexible workspaces. They are also told to highlight efforts in complying with health and safety protocols to temper consumer worries.

The industrial segment is seen as a bright spot by Colliers, as the rise in demand for food, medical and household products may offset the slowdown in demand from electronics manufacturers.

Warehousing companies are advised to tap digital technology to modernize their facilities to suit the needs of the growing e-commerce industry. Mall spaces that have been vacated by inoperable tenants are also seen as viable spaces for warehousing.

Lastly, the residential sector would have to adjust to the changing priorities of property hunters. Colliers said it expects vacancy rates to reach mid-teens at the end of the year as many have grown more cautious of spending.

Developers are told to offer attractive payment terms to continue attracting buyers and tenants, despite the effects of the pandemic.

“The Philippine economy continues to reel from the impact of the pandemic and lockdowns, officially entering into a recession. Colliers believes that conversion and repurposing of assets are crucial amid the pandemic and global economic downturn,” it said.

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Rockwell Land eyes more projects in countryside

September 2, 2020 | 12:01 am [ bworldonline.com ]

WWW.E-ROCKWELL.COM

PROPERTY DEVELOPER Rockwell Land Corp. will start a 30-hectare mixed-use development in Bacolod in central Philippines next year as it eyes more projects in the countryside due to changing consumer demand amid a coronavirus pandemic.

In a statement to the stock exchange on Tuesday, the company said more consumers prefer horizontal living spaces with wide open areas. Health experts say physical distancing is key to prevent the coronavirus from spreading.

“The shift in market behavior because of the crisis has led to changes in our plans to deliver more exciting developments,” Rockwell Land Chief Revenue Officer Valerie Jane Lopez- Soliven said in the statement.

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“This includes a new 30-hectare self-contained inner city mixed-use development in Bacolod set to launch in 2021,” she added.

Rockwell Land is developing a 10.9-hectare property in Bacolod, which will have vertical residential condominiums and retail spaces. The first residential project in the property started in December.

The company is also studying plans to develop projects in Cebu and Iloilo, and a joint-venture opportunity for expansion in Pampanga.

“We will continue to make chances as necessary during these uncertain times,” Rockwell Land President and CEO Nestor J. Padilla said in the same statement. “For now, the rest of our efforts will focus on the project completion.”

Earnings at Rockwell Land plunged 53% to P606.95 million in the first half from a year earlier after Luzon was locked down to contain a coronavirus pandemic starting in mid-March. Revenue fell by 40% to P4.14 billion.

Rockwell Land shares gained 1.97% or three centavos to P1.55 at the close of trading on Tuesday. — Denise A. Valdez

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