Real estate in the Philippines is a robust and thriving industry that directly addresses the needs of the country’s ever-growing population. While the housing market is still in the recovery phase post-COVID, observers believe that the industry has made substantial strides in getting back to what it was, with new development projects being announced, partnerships with foreign companies being forged, and capital spending being increased.
Real estate is an important cog in our country’s continued growth. For this reason, the role of a real estate developer is crucial –– a significant factor in shaping the way people live, work, and play. This articles takes a deep dive on what a real estate developer does and the significance of their work in upgrading the Filipino’s quality of life.
Key Roles and Responsibilities
A real estate developer is in the business of creating new structures and modifying existing ones to provide people with housing, workspaces, and lifestyle hubs. In the Philippines, developers commonly specialize in residential and commercial buildings, from single-family homes to condominiums, and retail spaces to office buildings.
Leading developers are able to handle multiple projects, beginning from the planning stage right up to the product completion. The work also involves the design process, coming up with financial strategies, putting the team together, and project management. After completing a project that is not categorized as a single-family home, the developer may sell the property to a third party that deals with investment in real estate. Otherwise, the developer may sell the house directly to consumers.
Challenges in Real Estate Development
Being a real estate developer can be lucrative, but like any business, it comes with challenges. The age-old adage of “build it and they will come” can be a costly without proper urban planning, and if you fail to read the market correctly. Thus, it is essential for developers to pursue development projects that are driven by existing needs.
A good market analysis includes factors such as economic, employment, educational, and environmental data –– information that will determine what the market needs in terms of structures.
Another challenge that developers may face is choosing the right location for the property. The success of any investment in real estate depends if it aligns with the right target market and demographics. Developers may assess a particular location based on the following:
- Accessibility
- Design requirements
- Financial strategies
- Planned improvements in the area
- What the competition is doing
- Impact on environment
Response to opposition is also crucial. Many projects have been derailed or put on hold when residents surrounding the area of the planned development oppose it due to valid concerns such as noise, traffic congestion, environmental impact, and so on. That is why leading developers in the country first try to determine if there is even a slight possibility that they may encounter opposition to a planned development, and from there, create an outreach strategy that will address the concerns.
Even a sustainable development needs the proper approvals usually obtained from the municipal office. After getting the plan approval, developers must also get the necessary permits for new construction, reconstruction, repair, or building removal. The permit and approval process should be started as soon to avoid any headaches during this stage.
Job site risks are always present and should be identified and evaluated properly. Once potential hazards are assessed, then the developers will be able to put in place the appropriate safety plans and procedures. It is important to note that while contractors are responsible for the safety of the workers, the developer who hired the contractor can still be held liable.
The developer could end up with a huge financial loss if there are errors in the design which cannot be covered by the liability insurance. However, there still ways the developer can mitigate the risks of losses caused by design defects. One way is to increase the insurance coverage, especially if it’s a large-scale construction project. Another way is to avoid design errors from happening in the first place. This can be done by hiring only highly qualified architects with a stellar work record and reputation.
Managing costs is also key in the success of a project. From material expenses to fluctuating labor costs, cost overruns can easily lead to an overblown budget. The best way to cost overruns is to add a buffer of 10 to 20 percent.
Opportunities for Innovation
In recent years, the real estate sector has been ramping up its efforts to incorporate new technologies. Leading developers have started partnering with tech companies, some have started testing new construction materials, and some have incorporated tech to reinvent property management and enhance the overall customer experience.
Investment in real estate technology can be seen in 4 areas, namely:
- User Experience – Developers and property managers alike use data mining to really put the clients first. The data being collected provides players with the insights about user expectations and interactions, allowing them to find the right customers and solve their housing problems better.
- Integration – Cutting-edge technologies such as artificial intelligence, virtual and augmented reality, and even robotics are being used as tools to integrate the digital space with the physical world. Nowadays, tech is being used to automate some of the manual tasks in the real estate process. New innovations are constantly being introduced to enhance customer experience, such as virtual tours where prospective buyers can view properties remotely.
- Safety – The smart contract is the latest buzzword in the property tech space. It gives the real estate business a go-to solution for more security and transparency, especially since binding agreements are involved. It also streamlines the contractual process as it eliminates the need for intermediaries.
- Sustainable Development – As more people are shifting towards home and office life with less carbon footprint, more focus is being given to the development of new and sustainable construction materials. Both residential and corporate spaces are expected to incorporate green technology during the development and construction, as well as their post-development maintenance.
Leading the Charge
PHINMA Properties, a Filipino-owned real estate developer, seeks to provide homes and communities that give residents access to the finest of Filipino living. Weaving Filipino tradition into homes, the company takes pride in instilling the country’s unique heritage and set of values into every development.
PHINMA Properties takes pride in crafting homes that inspire and uplift lives. For instance, Likha Residences is suited for those with discerning tastes and finest lifestyles. Each unit is meticulously designed to fit the needs and upgrade the quality of life of creators and forward-thinkers. The property’s interiors feature natural materials highlighted by an earth tone palette as a nod to traditional architecture and lifestyle. Inspired by the traditional bahay kubo, the units feature large awning windows that let in copious amounts of fresh air and natural light, while the louver windows and sliding doors are used for cross ventilation. Likha Residences truly embodies a future-proof development with progressive elements that can accommodate the Filipino family’s needs for tomorrow.
Another great example of a property that highlights eco-friendly living is PHINMA Maayo San Jose. After proudly securing Excellence in Design for Greater Efficiencies (EDGE) certification*, PHINMA Properties reaffirms its steadfast commitment to building a greener tomorrow through the said property, that also takes pride in having expansive spaces where families and individuals can grow. PHINMA Maayo San Jose has meticulously designed residences surrounded by thoughtfully curated amenities to future-proof the lives of Filipinos for generations to come.
*EDGE is a global advocate for championing resource-efficient and zero carbon structures.
Apart from future-proofing communities, PHINMA Properties takes it a step further by empowering future architects through a design competition that focuses on innovative design. In 2023, PHINMA Properties launched the competition in collaboration with De La Salle – College of Saint Benilde, School of Environment and Design, and challenged young visionaries to bring to life innovative housing solutions that will help address the needs of middle-class families in the Philippines. A total of 84 students participated in the competition and created designs that not only promote sustainability, but also renew the urban landscape as a whole. PHINMA Properties shares the excitement of showcasing the youthful energy and passion of the country’s future architects, to unveil innovative architectural concepts capable of enhancing lives and shaping the future of Filipino real estate.
PHINMA Properties promises to keep the industry’s positive momentum going, as it moves forward with strategic initiatives in urban planning and sustainability in the years to come. The country’s real estate industry still has a long way to go before it fully recovers from the pandemic –– but expansion remains on the horizon with all the innovations being made on the proptech front, investments being infused from investors, and enthusiasm being shown by developers and prospective home buyers alike.
To learn more about exciting real estate development opportunities or if you wish to collaborate with PHINMA Properties on future projects, visit phinmaproperties.com and leave us a message.
