Manila today is the Hong Kong and Singapore of 30 years ago, (and) the level of development in the metropolis over the last decade has been unprecedented and reflects the accelerated expansion of the property market.” Thus said the chairman of Santos Knight Frank, a leading property advisor in the Asia-Pacific region, a few weeks ago. The Santos in the company name is Rick Santos.
Rick Santos knows whereof he speaks. Not only is Mr. Santos a Filipino-American but, during his years as president of the American Chamber of Commerce of the Philippines, he also was a resident of this country.
In effect, Rick Santos believes that Manila – or, more precisely, Metro Manila—is the new Hong Kong. What Metro Manila is today is, in his opinion, what Hong Kong was in 1988. “Manila is a rapidly rising megacity powered by a growing pool of high-value talent, real estate expansion and a robust, consumption-driven economy,” Mr. Santos said.
He went on to note that Metro Manila had a population greater than the combined population of Hong Kong and Singapore. The population of this country’s premier metropolis has been placed at 25 million.
Metro Manila had become one of the favorite locations of the world BPO (business process outsourcing) industry, Santos Knight Frank’s chairman declared. In 2007 it ranked fourth in the Tholons Services Globalization (Outsourcing) Index, he said.
In two of the areas that are of utmost significance to the real property management industry—rent trends and vacancy rates—Metro Manila has been performing very well vis-à-vis Tokyo, Beijing, Shanghai, Taipei and other major East Asian cities, Rick Santos said. Prime office rents in Metro Manila have risen between 5 percent and 6 percent annually since 2011. And in mid-2017 Metro Manila’s 3.4 percent was one of the lowest vacancy rates in the Asia-Pacific region.
Santos Knight Frank’s chairman is right. Because of the frenetic construction activity of the last two decades, undertaken principally to meet the residential investment needs of the OFW (overseas Filipino worker) community and the office-space requirements of the BPO industry, Metro Manila has today what Hong Kong had 30 years ago.
But there is something that Metro Manila has in 2018 that Hong Kong does not have. That is the assurance of a secure juridical future. The agreement signed by China and the United Kingdom providing for a gradual change in Hong Kong’s juridical status from that of a British Crown colony to that of a Chinese SAR (Special Administrative Region) will expire in 2047. That is only 30 years away.
Is Hong Kong likely to retain its attractiveness and allure as a center of finance and trade when it is fully incorporated into a country as politically and administratively configured as China? I don’t think so.
What do you think, Rick Santos?
E-mail: romero.business.class@gmail.com
