UK Investment Fund Managers and Private Investor Clubs tap their deep pockets to purchase real estate investments within the Philippine Condotel market amid shortage of Hotel rooms driving expected ROI by means of rental returns upwards of 14% per annum.

„Rents which we thought we would get in two years we’re finding now,“ said Beth Collingz, a managing director in Metro Manila of the Condotel Marketing arm of PLC Global Pinoy, the International marketing and advertising partner of Pacific Concord Properties‘ Lancaster Brand of Condo Hotels within the Philippines.

Collingz expects rental earnings to rise 15 percent inside the coming 12 months after gains of as a lot as 30 percent given that January 2006, when Pacific Concord Properties Inc are set to launch Condo Hotel operations of their flagship Lancaster Suites located inside the Ortigas business district in Metro Manila.

UK Private equity units of banks and investment clubs, driven in aspect by the present strength of the Pound Sterling in international trading, are becoming attracted by returns inside the Philippines as much as double those in the United States and Europe, are buying considerable blocks of real estate for investment trusts for Asian commercial property.

„There are significant amounts of capital now chasing increasingly restricted investment-grade real-estate opportunities in Asia,“ stated Collingz. „We are presently in the closing stages of packaging the investment of some $20M in private-equity real estate funds for new Lancaster Brand Apart-Hotel or Condotel developments in Metro Manila and Cebu, on the strength of expected rental returns which will continue to develop at a rapid pace.“

With funds raised for commercial property deals in Asia having doubled in every of the past five years, Collingz see the market value of Condotel investments in the Philippines reaching new heights in 2007/8 as far more developments come on line.

Rising demand for houses, hotels, short and medium term rental accommodation, offices and shopping malls inside the Philippines, house to a population of virtually 80 million and with a substantial quantity of the a lot more than 10 million returning overseas Filipino ‚Baby Boomers‘, is fueling rents.

Residential rents in Metro Manila rose 26 percent within the three months to March 2007, their highest quarter-on-quarter increase in more than a decade, as an increasing number of IT firms set up shop in the Philippines. Businesses like Texas Instruments are investing $1B in expanded operations inside the Philippines. High-end rents rose some 13 percent from a year earlier, stated Collingz.

Collingz projects that Rents in the region are set to efficiently jump up by at the very least 8.7 percent per annum over the next 5 years, compared with three.3 percent in the United States and 3.7 percent in Europe. Yields from 8 percent to as high as 14-16 percent ROI on rental income property contrast using the four percent to five percent that private equity firms get within the United States and Europe.

„People are in common looking to shift fund flows fairly towards Asia,“ Collingz stated. „It already has had a profound impact in markets exactly where there’s lots of this money chasing the exact same assets.“ In Singapore, the region’s second- greatest marketplace after Japan, investments by private real estate funds accounted for seven of the 19 office blocks, worth 6.7 billion dollars, sold since September 2005. REITs bought six. A Goldman Sachs fund paid 690 million dollars for two buildings last November that home the headquarters of DBS Group Holdings. In Hong Kong, property funds of Morgan Stanley and Macquarie Bank paid a total of 7.9 billion Hong Kong dollars, or $1.02 billion, for 4 office blocks from March to May, according a recent post published by CB Richard Ellis.

As the Singapore, Japan and Hong Kong markets turn out to be saturated, the Philippines will probably be the next real estate market to attract substantial overseas investments. Lower prices and retirees‘ spending money are also directing foreign attention to residential condominium hotels within the Philippines, which in turn is driving up far more construction.

Plenty of this interest is being driven by the fairly low-cost marketplace costs here compared to Europe especially UK housing costs and also the easy payment options obtainable for condominium hotel developments Collingz mentioned. The buyers acquire rental incomes that on today’s purchase costs give a projected ROI of some 8 percent to 14-16 percent depending on the mode of payment for the unit she stated.