CEBU CITY—Pinnacle Real Estate Consulting Services Inc. (Precsi) officially launched on Tuesday its regional office here to further capture the booming property market, which, in turn, could help the company achieve its target of a 40-percent revenue hike by 2017.
Precsi President and Managing Director Michael Mabutol said the “Queen City of the South” is practically developed, with some even saying it is “bursting at the seams.”
“We don’t want to ‘miss the action’ here,” he told the BusinessMirror, adding this regional platform could serve their existing and future clients in the Visayas and Mindanao. “We are so optimistic about the market; it’s doing good now. And we see that the only direction is to go out [of Metro Manila].”
Based on the firm’s latest Market Insight report, Metro Cebu—comprised of the cities of Cebu, Lapu-Lapu and Mandaue—is the undisputed second top business center of the Philippines.
While the real-estate industry is very developed and has already reached its maturity, growth opportunities still abound across all segments, such as office, retail, residential, hotel and industrial properties, the study showed.
“There are still gaps in the market and some market inefficiencies that shrewd players may take advantage of,” said Jojo Salas, director for research and consulting of Precsi.
Buoyed by the strong demand from the ever-expanding business-process outsourcing (BPO) industry, the office market in Metro Cebu continues to gain from it.
In fact, close to 900,000 square meters (sq m) of Grade A office spaces are expected here by the end of 2016. Even though the vacancy rate now stands at 17 percent, the average monthly rents at P550 per sq m would show the market is absorbing the increasing office stock.
Cebuanos’ acceptance of the so-called condo-living solidifies, as there are around 22,284 condominium units at present. Approximately, the mean selling price is at P99,000 per sq m. The average take-up is 5,000 condo units annually—the same number of units set to be delivered by 2018. This indicates the projected increase in inventory may be comfortably absorbed by the market.
Meanwhile, the Cebu retail market is vibrant as seen in the total of 1,080,000 sq m of commercial-retail spaces. Since the market is steadily absorbing the unoccupied retail spaces, vacancy now dips at 9 percent, from 12 percent last year. Lease rates range from P700 to P1,300 per sq m a month in 2016.
Pinnacle estimates there is a total of 9,500 hotel rooms with star-qualification in Metro Cebu, or 22 percent higher than its 7,800 rooms in 2015. Amid the increase in inventory, average occupancy rises by 90 percent this year, from 85 percent in 2015.
The industrial market is also healthy, as there are now 27 information-technology parks/centers, seven manufacturing zones, two tourism economic zones and one agroindustrial economic zones in Metro Cebu. Overall, the ecozones span 120 hectares.
Seeing the robust activities now happening across all the property subsectors here, Mabutol is confident they could gain a significant share through their new office that serves half of their more than 100 clients with businesses in the Visayas and Mindanao.
“[So far] we’ve been able to serve our clients better, not just transactional, but we have the services we are rendering to them—such as property services, research and consulting, and valuation. Those are continuous and steady requirements from our clients that we are currently servicing now through our Cebu office,” he said.
Currently, Pinnacle caters to end-users, developers, petroleum companies and financial institutions in Cebu.
“I hope we’ll be able to serve [more] financial institutions—banks in particular—better than what we have done in the last 10 years. May we help further property owners, developers and petroleum companies to identify more opportunities for them. And then, of course, we’re looking at end-users, like overseas Filipino workers, whose steady demand is coming from abroad,” the top executive said.
Founded in 2005, Pinnacle is one of the leading real-estate service providers and asset-management companies in the country. Over a decade, it has handled 8,973 assets worth P48 billion. As to its brokerages business, it has a listing of about 25,000 assets amounting to P518 billion.
When it comes to nonperforming loans servicing, it has managed 5,750 accounts, or a total of 40,270 assets and accounts. The company’s track record speaks for itself that it’s not Manila-centric. Its businesses are equally divided nationwide, wherein 35 percent of the transactions done come from the Visayas region; 32.58 percent, Mindanao; and 32.42, Luzon.
“Business is good as always. We’re looking at 5 percent to as high as 20-percent growth [by end of 2016] as compared to last year,” Mabutol said of the company’s earnings before interest, taxes, depreciation and amortization, or Ebitda.
With Pinnacle’s expansion in Cebu through its regional office located on the second floor VCFI Building on Archibishop Reyes Avenue corner Molave Street in Cebu City, the firm’s president and managing director sees it contributing a lot to the firm’s overall business growth.
“We hope to see a 40-percent growth from our revenue or net profit. That’s what we’re targeting for next year,” he said. “Actually, three years ago, our target is to have 100 happy clients and generate P100-million revenue. That ended just last month. So far, we’re able to reach 100 clients. We are still working on the P100-million revenue goal. Hopefully, by next year, we can achieve that. We’re very optimistic about the market and with our expansion in Cebu. So we’re already looking at expanding in Davao in a year or two, as we don’t want to miss the opportunities there, as well.”
Source: Business Mirror | December 1, 2016
