Where to retire? Cebu!

CEBU, Philippines – Cebu’s reputation as the quieter, more relaxed sister city to Manila has earned it a new niche in the real estate market – retirees.

Quality of life is what the island in Visayas region offers, noted advocates. 

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“Cebu is positioned as one where the quality of life is better than the other cities. If you want to go to the beaches it’s few minutes away, if you want to play golf it’s just 5 minutes away. It’s a very livable city and it’s easy for you to move around,” said Lito R. Maderazo, Cebu Chamber of Commerce and Industries (CCCI) vice president at a press briefing on January 8.

Marko Sarmiento, COO of JEG Development Corp, is one local developer that has realized the potential of the market.

“Cebu is a lot more slow paced, it’s cheaper. That attracts the retirees,” said Sarmiento in an interview with Rappler.

Romantic location

One of the key attractive aspects to prospective retirees is the size of the city. “They have to be 30 minutes away from the golf courses, beach and hospital. Cebu is so small that most things are 20 to 30 minutes away,” he added.

Its location and connectivity is another added bonus. “We’re starting to see it…The entire Visayas is a big attraction. It’s very under-developed it’s got that romantic feel to it. It’s got lots of shoreline so they can do a lot of things with the water,” David Leechiu, country head at Jones Lang Lasalle Philippines, said on retiree developments during a property briefing on March 4. 

“The great thing about Cebu is that it’s easy come and easy go. It’s so easy to enter and leave Cebu. It’s accessible from South Korea and Singapore. They are trying to open up other airports so you’re going to see entire countries open,” he added.

Japanese retirees

JEG’s latest development is a 14-unit retirement village catering specifically to the Japanese.

“The Japanese market has been a proven market in terms of tourism. They have been coming here as tourists for many years even before the Korean market grew. They look at Cebu as a separate destination a tourist spot and a place to get away from the fast-paced lifestyle of Japan,” said Sarmiento.

Japan’s average age is a lot higher than most countries. With such a large segment of the population about to enter retirement, it’s a lucrative segment.

“The units are designed for the Japanese and there are specific units that focus on the Japanese market,” he added.

They launched their marketing in November and are looking to sell out by this year. “Their reaction has been good. They like the idea that it’s a private community,” he said.

If this development is successful, Sarmiento said they will launch a similar concept with their next development.

Megaworld Corp’s development One Pacific Residences have also seen a lot of interest from Japanese retirees who have snapped most of the units.

Cebu’s booming real estate industry

The real estate industry in Cebu has been one of the fastest growing of the city’s economy. The industry recorded a revenue growth rate of 18.8% in the third quarter of 2012.

“If you move around Cebu you can see there’s a mushrooming of projects and that is on account of the fact that Cebu’s economic drivers — BPO’s and tourism,” noted Francis Monera, VP of Visayas at the Philippine Chamber of Commerce and Industry.

Overseas Filipino workers (OFW) looking to invest in their home country are fueling the growth of the low-end to mid-range sectors.

“We’re seeing a sort of a transformation here. Probably about 10 to 20 years ago you would have only seen people from the Visayas and northern Mindanao area renting houses from Cebu. But now you will see that subdivisions are being sold to OFWs that are not even from Cebu. This is the first time we are seeing so many condominiums built in Cebu for OFWs who are not from Cebu,” said Maderazo.

Growth has also been fueled by remittances and a growing BPO sector. Cash remittances from January to October 2012 reached $17.5 billion up 5.8% from 2011’s $16.5 billion.

This has led to a lot of interest from big national industry players. Cebu Holdings, Inc. is an affiliate of Ayala Corporation engaged in real property development, ownership and management. Their projects include the Cebu Park Districts – Cebu IT Park and Cebu Business Park, which hosts other residential, and commercial properties they developed in partnership with other Ayala subsidiaries like Ayala Land Premier, Alveo Land Corp., and Avida Land Corp.

Tan-led property developer Megaworld Corp. said they will be investing P10 billion over the next 6 years to develop a 16-hectare mixed use development property in Mactan.

Gokongwei-led Robinsons Land Corp will also be developing a 4.6 hectare residential development in the North Reclamation Area of Cebu, as well as a Robinsons Galleria Cebu, which will house a shopping malls as well as hotel and BPO offices.

“Not everyone’s in Cebu yet. We have a lot of big developers here but there are a lot and there will be a time when they come,” said Sarmiento. – Rappler.com