Written by Tribune
Growing investor confidence on the country was recently affirmed by the improved ranking of the Philippines in the 2012 Global Real Estate Transparency Index, a biennial Jones Lang LaSalle (JLL) worldwide survey that assesses transparency in 97 real estate markets by weighting 83 different factors.
The Philippines, which ranked 35th globally, was named among the top 10 markets worldwide that improved significantly in the period from 2010 to 2012. Of the Top Improvers, the Philippines ranked seventh with Turkey ranking the highest followed by Brazil and Mexico. The Philippines practically tied with Indonesia among the top improvers but bested Vietnam, South Korea and Thailand in the same category.
David Leechiu, JLL country manager, disclosed that the improved scores of the Philippines bodes well for the country. “Increased transparency attracts more investors. And as more investors flock to a country, the environment for even greater transparency improves.”
Claro Cordero, head of research of Jones Lang LaSalle Leechiu, attributed the improved real estate transparency rating of the Philippines to major changes in regulatory and transaction processes. He says: “The supervision of the licensing of various real estate professionals by the Professional Regulation Commission and the digitization of land titles by the Land Registry Commission are among the factors that improved our country’s transparency rating. The increase in threshold amounts for VAT-exempt real estate transactions likewise pushed up the scores of the Philippines.”
Higher real estate transparency encourages more foreign investments in real estate, which in turn has corresponding positive multiplier effects on other industries and on the economy, in general. The Global Real Estate Transparency Index also assists governments and other industry organizations interested in improving transparency.
The index named the United States as the world’s most transparent real estate market in 2012, followed by the United Kingdom and Australia. Also in the Highly Transparent category were Netherlands, New Zealand, Canada, France, Finland, Sweden and Switzerland.
Jacques Gordon, global head of strategy for LaSalle Investment Management, the investment management arm of JLL, observes: “While the world economy is still in recovery, the 2012 Index reveals that real estate investors and corporate occupiers are widening their activity across a broader range of markets. This cross-border activity encourages faster rates of transparency improvement in growth and emerging economies as the markets open up further to international competition and their real estate sectors embrace global best practices.”
The index also noted that “in emerging Asia, increasing corporate occupier activity is encouraging the pace of transparency improvement in Indonesia, the Philippines and Vietnam.” In the Philippines, the most significant occupiers have been international offshoring and outsourcing firms. Recent studies by Jones Lang LaSalle Leechiu have also noted the increasing demand for office space from multinationals in the finance and insurance industries as well as from local firms upgrading their office spaces.