MANILA – The Philippine retail industry is seeing new trends as both local and international brands continue to expand in the country, according to a research by CBRE Asia Pacific.
CBRE said real estate developers are diversifying into the retail segment to accommodate consumer demand for shopping convenience where they are offered ease of access from their residences or office.
The research and consultancy firm cited upcoming mixed-used projects such as the Solaire expansion and City of Dreams, which are predicted to boost the retail supply by at least 65,000 square meters.
The new concept of “retail-tainment” is also being used by more developers to give Filipino shoppers the “overall retail experience,” incorporating food courts, cinemas, ice-skating rinks, bowling alleys, children’s playgrounds, and pet parks into shopping malls.
“The retail market in the Philippines has, and still continues to mature. Filipinos are now after the overall retail experience, choosing malls and outlets that give them the power of choice--whether in food and beverage or clothing and the like. It also helps that developers allow the interests of the tenants and consumers to meet by giving them a convenient place to stay in, unwind and shop,” said Rick Santos, president, chairman, and chief executive of CBRE Philippines.
CBRE cited as an example the SM Seaside City Cebu, which will include cinemas, an 18-lane bowling alley, a 1,020-seat theatre, and a 250,000 square feet roof garden. SM Seaside City will be completed in 2015.
CBRE said the retail-tainment factor is expected to attract foot traffic as well as help landlords achieve higher returns in branding, image and media exposure, and revenue.
The concept of retail-tainment, CBRE added, is a result of understanding the primary interests and needs of tenants and consumers.
In its 2014 Asia Pacific Consumer Survey “How We Like to Shop,” CBRE said Asia Pacific consumers prioritize shopping experience and value, convenient travelling distance, price, cleanliness, and security.
“The Philippines’ retail market has already entered a new age. It’s just a matter of sustaining this growth and developing it further to integrate and match with the consumers’ changing profiles and demands,” said Santos.
There has also been an increase in food and beverage retailers, both local and international, in the Philippines, according to CBRE.
“The presence of more restaurants, coffee shops, and even convenience stores, shows that more Filipinos have the capacity or purchasing power to shop and dine,” said Santos.
CBRE is also seeing a rise quick-service restaurants, primarily fast food outlets, which capitalizes on Southeast Asia’s relatively young market.
A recent research by CBRE Asia Pacific, “The New Age of the Asia Pacific Real Estate Market,” also cited the Philippines as a key growth market along with Hanoi and Ho Chi Minh in Vietnam and major cities in Indonesia and Malaysia.
It attributed the “wave” of retailer expansion on the expansion of the middle class, bullish outlook on economic growth, and increase in tourism activities across the regions.
“In the Philippine landscape, these factors look promising. The resilience of the economy has been tested and proven this year, bouncing back quarter per quarter. Likewise, the country’s tourist attractions and opportune business landscape has continuously been boosting investor interest,” said Santos.
In the Philippines, 70 percent of gross domestic product (GDP) or economic output comes from consumer spending, supported by remittances from overseas Filipino workers.