Colliers, a global real estate management firm, has warned that the high costs of construction materials in the Philippines could affect planned residential launches in 2023, potentially prompting developers to focus on high-end segments. Data from the Philippine Statistics Authority indicates that the growth in retail prices of construction materials only eased slightly in February 2023 from the previous month, although it reflected a decline compared to January. Nicholas Antonio Mapa, senior economist at ING Bank, said that this was due to cheap imported construction materials as well as a stronger peso. However, Colliers Research Director Joey Bondoc said that demand for construction activity might still slow down given the interest rate hikes imposed by the Bangko Sentral ng Pilipinas. The increase in construction costs may have tempered condominium launches during the period. Bondoc noted that most recent project launches primarily targeted the affluent market, with upscale and luxury units accounting for 32 percent of total condominium launches in Metro Manila. These projects are located in major central business districts such as Bonifacio Global City, Bay Area, and Ortigas Central Business District. Bondoc predicted an aggressive launch of luxury units in the central business districts as well as the outskirts of Metro Manila, with high-priced residential units likely to remain resilient in 2023.
