Construction in the Philippines - Key Trends and Opportunities to 2017


Naperville, IL -- (SBWIRE) -- 09/05/2013 -- Reportstack, provider of premium market research reports announces the addition of Construction in the Philippines - Key Trends and Opportunities to 2017 market report to its offering
The construction industry in the Philippines grew at a review-period (2008?2012) CAGR of 10.27% and was largely unaffected by the financial crisis. Construction output recorded respective annual growth rates of 6.4% in 2009 and 20.9% in 2010, though the countrys construction output declined marginally by 2.2% in 2011. Review-period growth was supported by the growing business process outsourcing (BPO) industry, infrastructure development projects and a rise in income levels. The construction industry is expected to post a forecast-period (2013?2017) CAGR of 7.66% with growth originating largely from the governments development plan for 2011-2016 to improve infrastructure, healthcare and competitiveness.

This report provides a comprehensive analysis of the construction industry in the Philippines:
Historical (2008-2012) and forecast (2013-2017) valuations of the construction market in the Philippines using the construction output and value-add methods
Segmentation by sector (commercial, industrial, infrastructure, institutional and residential) and by project type
Breakdown of values within each project type, by type of activity (new construction, repair and maintenance, refurbishment and demolition) and by type of cost (materials, equipment and services)
Analysis of key construction industry issues, including regulation, cost management, funding and pricing
Assessment of the competitive environment using Porters Five Forces
Detailed profiles of the leading construction companies in the Philippines

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Key Highlights
The domestic economy expanded by 6.6% in real terms in 2012, up from 3.9% in 2011 and was above the governments official target range of 5?6.0%. This expansion was mainly brought about by government spending and investment growth, which accelerated from 1.0% and 0.1% in 2011 to 11.8% and 8.7% respectively in 2012.
Economic prospects are positive with an average growth rate of 5.5% anticipated over the forecast period
The construction industry recorded a period of robust growth backed by a rise in employment and income levels. The number of new building construction projects with approved permits increased from 24,610 in the fourth quarter of 2011 to 27,931 in the fourth quarter of 2012, a year-on-year increase of 13.5%. In order to increase the nations investment attractiveness, enhance competitiveness and promote socio-economic development, the government unveiled the Philippine Development Plan (PDP) 2011-2016. The plan involves substantial investments in physical infrastructure, which it deems as roads, railways and energy; social infrastructure which it defines as education, healthcare and housing; and technology which it outlines as research and development.
The BPO industry is a key driver of office space development and the industrys robust outlook is expected to benefit the expansion of office buildings. There has been a rise in purchasing power among the domestic population, owing to solid growth in the BPO industry and rise in remittances from overseas Filipinos. This, coupled with favorable economic conditions and a rising urban population, is expected to support a surge in retail activity.
The industrial construction market was the fastest-growing construction market in the Philippines during the review period, driven by a rebound in the nations manufacturing activity since 2010. The performance of the manufacturing sector is expected to improve over 2013-2014 with a surge in exports backed by an anticipated recovery in global economic conditions. Growth will also be supported by governmental efforts to ease procedures for establishing new businesses and reduce operational costs by initiating expansion measures.
A lack of adequate infrastructure has been a major deterrent to the business attractiveness of the Philippines. Although successive governments have increased infrastructure investment as a proportion of GDP at 3%, they are among the lowest in Southeast Asia. In order to enhance competitiveness in terms of physical infrastructure, the country is investing in infrastructure, with the intention of achieving an investment target of 6% of GDP by 2016.
With the intention of achieving energy independence by 2030, the Philippines Department of Energy (DoE) launched the 2012-2030 Philippine Energy Plan (PEP) in 2012. The energy and communications infrastructure category is expected to be the fastest-growing category in the infrastructure construction market over the forecast period.
The country is expected to witness a transformation from a nation of renters to homeowners, due to the availability of attractive financing options and prevalence of very low interest rates. The rapid increase in homeownership will also be supported by the rise of the younger population (20-30 years), who accounted for one-fifth of the national population in 2010. This trend of homeownership is expected to support the expansion of residential construction.

Companies Mentioned

Ayala Land Inc.
EEI Corporation
Highlands Prime Inc.
SuperCity Realty Development Corporation

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