“Right now, there’s a lot of noise so I guess [for buyers] it’s wait and see,” Augusto "Toti" Bengzon, veteran ALI executive and management committee member, told InsiderPH on the sidelines of the Shareholders Association of the Philippines event on Wednesday.
“The investment appetite is a little bit subdued now,” he added.
High-end market in focus
The industry is keeping a close watch on key upscale and luxury segments, as hearings on the flood control mess create uncertainty around big-ticket purchases.
Some of this spending has also been tied to politicians’ unexplained wealth, according to industry insiders.
ALI, one of the country’s biggest developers with a wide portfolio of high-end and luxury real estate, could face vulnerabilities in a key part of its business.
Cash discounts for luxury tower
One real estate broker, who requested anonymity, told InsiderPH that sales of its upscale homes slowed down after the hearings began.
For years, the high-end residential segment has complemented ALI’s strong commercial presence through its malls and estate projects, even as the industry grapples with a mid-market condo oversupply in Metro Manila.
In early September, the developer reported strong take-up for Laurean Residences, its newest luxury tower in Makati City, securing P8 billion in pre-sales.
But another broker said the developer offered uncharacteristically large discounts to cash buyers, suggesting softer-than-expected demand.
Property sector continues to grow
Industry observers said there are bright spots, with lower interest rates creating opportunities for buyers to step in. This is after the Bangko Sentral ng Pilipinas cut rates three times this year by 25 basis points each, in April, June, and August.
Bengzon stressed that ALI’s fundamentals remain solid despite the noise.
“Let’s see how it goes until the end of year. I am confident the market will continue to grow,” he said.
Miguel R. Camus has been a reporter covering various domestic business topics since 2009.
