Property developers in the Philippines are expected to significantly increase their spending on structural upgrades and resilience measures in response to recent earthquakes in Mindanao. This shift comes as buyers prioritize safety and integrity in their real estate investments.
Claro dG. Cordero, Jr., research director at Cushman & Wakefield Philippines, noted that developers are reassessing their structural systems as part of a strategy to enhance project competitiveness. He emphasized that resilience is becoming a key factor in leasing and capital allocation decisions.
Resilience is rapidly emerging as a measurable competitive differentiator.
Claro dG. Cordero, Jr., Director for Research, Cushman & Wakefield Philippines
Dino Mari G. Palanca, director for marketing and research at Savills Philippines, stated that developers are now focusing on redundant systems and business continuity planning. He mentioned an expected surge in inspections and repair assessments following the earthquakes.
- Increased structural inspections post-earthquakes.
- Focus on enhancing safety features and long-term durability.
Consumer awareness regarding the quality of buildings is also rising. Buyers are increasingly interested in developers' track records and compliance with seismic standards, indicating a shift in purchasing priorities.
Despite concerns, Cordero pointed out that the demand for condominiums remains strong, particularly those adhering to seismic standards. He added that the market is differentiating based on location and the severity of earthquake impacts.
Older buildings are not exempt from this trend; Cordero estimates that seismic upgrades could cost between 10% and 30% of a building's replacement value. He advised owners to consider phased retrofitting strategies to manage costs effectively while enhancing property resilience.
Palanca highlighted that while these upgrades may affect short-term returns, they are essential for maintaining tenant confidence and ensuring insurability. He characterized recovery from such seismic events as gradual, often taking three to five years, particularly in heavily damaged urban areas.