Condo developers urged to use creative rental models

MANILA, Philippines — Condominium developers should explore creative rental models such as putting up their own leasing arms, as condominium vacancy rates continue to rise, a property services firm said.

Colliers International Philippines research manager Joey Roi Bondoc told The STAR that developers should organize their own leasing arms in order to assist buyers to lease out their units and attain the yields promised.

He suggested this as among the ways developers could address the rising condominium vacancy rates in Metro Manila.

“For developers with significant ready for occupancy (RFO) units, leasing out units may make sense, as long as it does not go against the market positioning of the property and does not lead to the deterioration of the condominium’s perceived value,” Bondoc said. 

In the first quarter of the year, the residential market vacancy rate remained in the double-digit territory at 12.4 percent in Metro Manila.

“We project that overall vacancy in the next two to three years will hover between 12 and 16 percent given the still 27,100 units to be completed through 2021,” Colliers said in an earlier report. 

Bondoc said the rental residential market also offers opportunistic demand to developers who open up their projects to home-sharing apps such as Airbnb and Homeaway.

“Some developers are open to the concept, some are aren’t. This is an opportunistic demand that developers could tap especially in the fringes of business districts,” Bondoc said.

Robinsons Land Corp. is one developer who recently incorporated this concept in its The Radiance Manila Bay project, in a bid to get a share of the growing tourist market. Units of the project are up on lease through online apps such as Airbnb, HomeAway, Roomorama, and Tripping.com.