A real estate developer in Cebu will invest P4 billion for five new residential and commercial projects to be launched next year.
The projects would cater to the fast expanding middle class market, said Jose R. Soberano III, Cebu Landmasters Inc. president and chief executive officer, in an interview .
The projects are an office building in IT Park, a 10-hectare house and lot development in south Cebu, a five-hectare property development in Consolacion town , a condominium project in Salinas Drive in Cebu City, and a second tower in the firm’s existing development in Gen. Maxilom Avenue ue called the Baseline 2.
“We’ll launch the office building in IT Park called Park Central by first quarter of 2013 then the 10- hectare project somewhere in the southern part of Cebu,” said Soberano.
The Park Central will be a 20-story building near Asia Premier which was Soberano’s first vertical project. The building will add 1,500 square meters to serve the growing demand for space by outsourcing companies.
“For that building alone, we are looking at an investment of P750 million. It will be completed by 2015,” said Soberano.
The condominium project in Salinas Drive in Lahug and the Baseline 2 tower will be launched by third quarter of next year followed by the five-hectare project in Consolacion town.
Soberano said these new projects would show the firm’s confidence of the market in Cebu.
He agreed with the observation of Dr. Winston Conrad Padojinog, dean of the The University of Asia and Pacific school of management, that the economic and low-cost residential market was underserved.
Soberano said, however, that as a developer, he would rather partner with organizations that have the capability to serve this market.
“That is one of the reasons most developers don’t do low-cost housing. It’s not our line of expertise. In my case I partner with Habibat (for Humanity) and GK (Gawad Kalinga) which have been doing these kinds of projects,” said Soberano.
He said he gave funds to Habitat for Humanity and GK which they used to build houses that cost as low as P150,000.
“That is how I satisfy the 20 percent requirement of government for developers to have low-cost and economic class residential projects,” said Soberano.
He said partnering with credible institutions for the lower class segment would allow him to focus on what he would do best – creating projects for the middle-income market.
“I have always been involved in the middle class so all my projects will be focused there,” he said.
Soberano, a past president of the Cebu Real Estate Developers Association (Creba), said he didn’t consider the high-end market as an unserved market because people here already owned houses and were buying more units for various reasons because they could afford them.
“There are 3.5 million people still unserved and easily about five percent of that is here in Cebu or about 170,000. A large portion comes from the low and middle-end market,” said Soberano.
With many developers in Cebu abd a competititive market, he said his firm had to make projects that are irresistible.
“People are now buying but as a developer you don’t just wait. You have to do something, come up with a project that they can’t resist even those who already have homes,” said Soberano.
He said the upswing in the real estate market would also be fueled by low interest rates offered by banks.