Southern Manila West Growth Area

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Southern ManilaWest Growth Area

2014

In assoc iation with


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Contents Cuervo Far East, Inc.

Economic Overview

Real Estate Industry Overview

Southern Greater Manila

Southern Manila West Growth Area (WGA)

Selected High-end Residential Subdivisions

Southern Manila WGA SWOT Analysis

Zonal Values

Market Values 2009 and 2014

Projec ted Land Va lues 2015 to 2019

Conclusion

References

Contact Details

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Cuervo Far East, Inc. Founded in Manila in October1993

A private corporation which is 100% Filipino-Owned

Hands-on management by the majority stock holder (J osemari Cuervo- President & CEO)

Previous association with Richard Ellis from 1996 to 1998, and withCushman & Wakefield from 1999to 2013

Sister company of Cuervo Appraisers, the leading valuation companyin the Philippines for over 32 years.

Head Office located at Makati City with a branch office in Cebu City

- Our mission is to provide the most professional and comprehensive real estate solutions for ourclients by creating, protec ting and optimizing value throughout the consultant client relationship -

3


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Cuervo Far East Inc. - Services

Asset Services

Property Management

Project Management Facilities Management

Research / Consultancy Services

Research and Market Intelligence

Development Consultancy

Corporate Location Strategy

Valuation & Investment Advisory

Transaction Services Office, Residential, Retail and Industrial Agency

Brokerage

Tenant Strategies and Solutions

Negotiation Services4


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Economic Overview

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The Philippine economy registered a strong growth of 6.0% for the first halfof 2014.

Inflation for October remained stable at 4.3% which reflects easing

consumer prices.

The country was accorded a ratings upgrade to investment grade statusby top global credit rating agencies such as Standard & Poors, Fitch, andMoodys Investor and Service making it an attractive destination forinvestors.

Various Public-Private Partnership (PPP) projects by the government areexpected to spur the growth of the Philippine economy.


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Real Estate Industry Overview

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The real estate industry is one of the fastest growing sectors of theeconomy in recent years.

High demand for office spaces fuelled by the Business Process

Outsourcing (BPO) boom and expansion of international andmultinational corporations.

Manufacturing growth pushed the demand for industrial spaces such aswarehouses and manufac turing plants.

Residential market fuelled by the growing high and middle-class income

earners and as well as the steady increase of remittances from OverseasFilipino Workers.


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Southern Greater Manila

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The southern greater Manilahas a great potential forgrowth.

Various infrastructureprojects and real estatedevelopments makes it aviable alternative toMakati, Mandaluyong andOrtigas.

Developments in Muntinlupaand Sta. Rosa C ity are at theforefront of this expansion inthe South.


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Southern Manila

West Growth Area (WGA)

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The Southern Manila WestGrowth Area (WGA) isexpected to grow in termsofcapital values for highendcommercial and residential

developments.

This report will show thehistorical and projected landvaluesof high-end residentialdevelopments within theSouthern Manila WGA.

The Southern Manila WGA islocated along the west sideof South Luzon Expresswaywhich include areas withinMuntinlupa and Las Pinas.


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2014 Current Land Valuations for Selected

High-end Residential Developments

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Ayala AlabangPHP50,000 60,000 per sqm

Ayala Southvale Village

PHP30,000 35,000 per sqm

Ayala Southvale SoneraPHP30,000 35,000 per sqm

Alabang Hills VillagePHP30,000 35,000 per sqm

Alabang HillsboroughPHP30,000 35,000 per sqm

Alabang WestPHP47,000 49,000 per sqm


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Southern Manila WGA

SWOT Analysis

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STRENGTHS

Accessibility Current land prices are favorable

for investments Existing road infrastructure Presence of support services andfacilitiesLow risk from geohazards

WEAKNESSES

Perception as too far from thetraditional CBDs Makati, BGC and

Ortigas Center.

OPPORTUNITIES

Increase in land values projectedto be around 10% to 15% per year Businesses are decentralizing fromtraditional CBDsVarious development andinfrastructure projec ts

THREATS

Various developments in the North Delay in the implementation ofinfrastructure and developmentprojec ts.


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SWOT Analysis StrengthsAccessibility

11Sou rce : Pub lic -Priva te Partne rship (PPP )we b site


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SWOT Analysis StrengthsRoad Infrastructure - South Luzon Expressway (SLEx)

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The South LuzonExpressway (SLEx) isa network of twoexpressways thatconnects MetroManila to theCALABARZONregion.


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SWOT Analysis StrengthsRoad Infrastructure - Manila-Cavite Expressway (Cavitex)

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The Manila-CaviteExpressway (C AVITEx)connects Manila to

Cavite.


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SWOT Analysis StrengthsRoad Infrastructure - Daang Hari Road

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Daang Hari Roador Las Pinas-Muntinlupa-

Laguna-Cavite LinkRoad connectsMetro Manila toCavite.


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SWOT Analysis StrengthsRoad Infrastructure Cavite-Laguna Expressway (CALAX)

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The Cavite-Laguna Expressway(CALAX) is a PPP

projec t that willconnect CAVITEx(Kawit) to SLEX(Mamplasan).


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SWOT Analysis StrengthsRoad Infrastructure Muntinlupa-Cavite Expressway (MCX)

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The Muntinlupa-Cavite Expressway(MCX), formerlycalled Daang Hari-SLEX Link Road, willconnect DaangHari to SLEX.

It is scheduled toopen on the firsthalf of 2015.


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SWOT Analysis StrengthsLow Risk from Geohazards

17Sourc e: Dep t. Of Environm ent a nd Natu ral Resou rces (DENR), Mines and Ge oscienc es Burea u - Southe rn Mani la WGA


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SWOT Analysis StrengthsLow Risk from Geohazards

18Sourc e: Dep t. Of Environm ent a nd Natu ral Resou rces (DENR), Mines and Ge oscienc es Burea u - Southe rn Mani la WGA


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Zonal Value

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ZONAL VALUES MUNTINLUPA

Barangay: Ayala Alabang

Street/Subdivision Vicinity Classification6th Revision

(2-May-97)

7th Revision

(14-June-14)Ayala Alabang

Village

Phases 1, 2A, 3A1, 3A2, 3B1, 3B2,

3B3, 4, 5, 6, 7, 8A, 8B, 9, 10A, 10B,

10C, 10D, XI-A, XI-B, XI-C & XII

Residential

Regular(RR)18,100 40,000

Ayala Alabang

Village

Lots backing the golf course Phases 4

&2B

Residential

Regular(RR)16,500 60,000

Ayala Alabang

Village

Lots along the perimeters of Apitong,

Adelfa, Rosal, Batangas East, South &

West, Tamarind, Langka, Santiago, &

portions of San Juanico, Guava Drive,

Tamarind Drive, San Lorenzo, Mabolo

Residential

Regular(RR)16,000 38,000

0

20,000

40,000

60,000

, 3A1, 3A2, 3B1, 3B2, 3B3, 4, 5, 6, 7, 8A, 8B, 9, 10A, 10B, 10C, 10D, XI-A, XI-B, XI-C & XIILots backing the golf c ourse Phases 4 &2BLots along the perimeters of Apitong, Adelfa, Rosal, Batangas East, South & West, Tamarind, Laportions of San J uanico, Guava Drive, Tamarind Drive, San Lorenzo, Mabolo

18,100 16,500 16,000

40,000

60,000

38,000

PHPperSq

uareMeter

Zonal Values Muntinlupa - Ayala Alabang Village

6th Revision(2-May-97)

7th Revision

(14-J une-14)


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Zonal Value

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ZONAL VALUES MUNTINLUPA

Barangay: Cupang

Street/Subdivision Vicinity Classification6th Revision

(2-May-97)

7th Revision

(14-June-14)Alabang Hills

Village Subd.St. Benedictine

Residential

Regular(RR)8,000 28,000

Alabang

HillsboroughAlabang Hills

Residential

Regular(RR)11,500 28,000

0

5,000

10,000

15,000

20,000

25,000

30,000

Alabang Hills Village Subd. Alabang Hillsborough

8,000

11,500

28,000 28,000

PH

PperSquareMeter

Zonal Values Muntinlupa

Alabang Hills Village Subd. &Alabang Hillsborough

6th Revision(2-May-97)

7th Revision(14-June-14)


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Market Values 2009 & 2014

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Market Values 2009 & 2014

(Php per Sq. M.)

Area 2009 2014

Ayala Alabang Village 30,000 - 32,000 57,000 - 62,000

Alabang Hills Subdivision 14,000 -16,000 38,000 - 40,000

Hillsborough Subdivision 14,000 15,500 38,000 42,000

Ayala Southvale 16,000 -17,500 30,000 35,000

0

10,000

20,000

30,000

40,000

50,000

60,000

AyalaAlabangVillage

AlabangHills

Subdivision

HillsboroughSubdivision

AyalaSouthvale

30,000

14,000

14,000

16,000

57,000

38,00038,000

30,000

PHPperSquareMeter

Market Values - 2009 & 2014 (Low Range)

2009

201

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

AyalaAlabangVillage

Alabang HillsSubdivision

HillsboroughSubdivision

AyalaSouthvale

32,000

16,000

15,50017,500

62,000

40,000 42,000

35,000

PHPperSquareMeter

Market Values - 2009 & 2014 (High Range)

2009

2014


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Projected Land Values - 2015 to 2019Upper Mid-end at 10% increase per annum

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Upper Mid-end Residential Lots (10% p.a. increase)

(Php per Sq. M.)

Year Low High

2014 30,000 40,000

2015 33,000 44,000

2016 36,300 48,400

2017 39,930 53,240

2018 43,923 58,564

2019 48,315 64,420

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

2014 2015 2016 2017 2018 2019

30,00033,000

36,30039,930

43,923

48,315

40,00044,000

48,400

53,240

58,56464,420

PHPperS

quareMeter

Year

Upper Mid-end Residential Lots(10% annual increase)

Low

High


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High-end Residential Lots (10% p.a. increase)

(Php per Sq. M.)Year Low High

2014 50,000 60,000

2015 55,000 66,000

2016 60,500 72,600

2017 66,550 79,860

2018 73,205 87,846

2019 80,526 96,631

0

10,000

20,000

30,000

40,00050,000

60,000

70,000

80,000

90,000

100,000

2014 2015 2016 2017 2018 2019

50,00055,000

60,50066,550

73,205

80,526

60,00066,000

72,600

79,860

87,846

96,631

PHPperSq

uareMeter

Year

High-end Residential Lots (10% annual increase)

Low

High

Projected Land Values - 2015 to 2019High-end at 10% increase per annum


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25

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

2014 2015 2016 2017 2018 2019

50,00057,500

66,12576,044

87,450

100,568

60,00069,000

79,350

91,253

104,940

120,681

PHPper

SquareMeter

Year

High-end Residential Lots (15% annual increase)

Low

High

High-end Residential Lots (15% p.a. increase)

(Php per Sq. M.)

Year Low High

2014 50,000 60,000

2015 57,500 69,000

2016 66,125 79,350

2017 76,044 91,253

2018 87,450 104,940

2019 100,568 120,681

Projected Land Values - 2015 to 2019High-end at 15% increase per annum


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Conclusion

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The Southern Manila West Growth Area (WGA) residential land values are projected tosteadily apprec iate in the near-term.

High-end Residential Land values, are seen to increase from 10% to 15%annually, provided all infrastructure projects and other developments are c ompletedon time.

Smaller lot cuts will have a higher price per square meter compared to larger lot cuts.

The profile of the market has matured. Buyers take into consideration fac tors such asgeohazards, accessibility, and availability of support services when making aninvestment dec ision.

An expected increase in Zonal Values in the near term will affect the cost of sales forland which will result in higher asking prices.

Due to the lac k of available supply in this sec tor, we believe that demand forces inthe market will greatly affect capital values in the next five years.

We will most likely see capital values breaching Php100,000 per sq.m. by 2019.


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References

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Philippine Statistics Authority (PSA)

Public-Private Partnership (PPP) website

Department of Public Works and Highways (DPWH)

Department of Environment and Natural Resources (DENR)

Philippine Institute of Volcanology and Seismology(PHIVOLCS)

Bureau of Internal Revenue (BIR)

Wikimapia

Cuervo Appraisers, Inc.


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Contact Details

Name : J ose Maria C . Fernandez-CuervoLandline : (+63 2) 750 6608Mobile : (+63) 917 838 8088E-mail : [email protected]

Mailing Address:

5th Floor S&L Building, 101 Esteban St. cor. Dela Rosa St., LegaspiVillage, 1229 Makati City, Philippines

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Southern Manila West Growth Area

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