Approved building permits fall 8.5% in July

Approved building permits declined 8.5% year on year in July as residential construction projects slumped, the Philippine Statistics Authority (PSA) reported.

Preliminary data showed building projects covered by the permits numbered 15, 395 in July from 16,821 a year earlier.

This was a turnaround from the 12.3% growth in July 2024 and the revised 14.9% expansion in June.

For that month, constructions projects covered 3.47 million square meters (sq.m) of floor area, slipping 2.1% year on year from 3.54 million sq.m.

These building projects that received approval were valued at P44.54 billion, 7.5% lower than a year earlier when it reached P48.16 billion.

Permits for residential projects, which accounted for 66% of the total, declined 8.5% to 10,157 in July.

These projects were valued at P19.77 billion, against the P19.74 billion a year earlier.

Single homes made up 79.1% of the residential category with approved permits declining 10.9% to 8,034.

Applications for apartment buildings rose by 2.5% to 1,957 while applications for duplex or quadruplex homes contracted by 3.1% at 155.

On the other hand, nonresidential projects tallied 3,205 approvals in July, decreasing 8.8% from a year earlier.

Nonresidential permits were valued at P19.84 billion, down 16.6% from P23.78 billion a year earlier.

Approved commercial construction permits numbered 2,150, down 11.3%.

Permits for additions — construction that increases the height or area of an existing building — dropped 16% to 429 in July, while alteration and repair permits totaled 1,133, down 15%.

Industrial permits rose 27.4% to 302, while institutional projects fell 12.1% to 582 approvals.

Agricultural projects totaled 89 approvals, down 19.1%, while other nonresidential works reached 82 building permit approvals, down 2.4%.

Calabarzon (Cavite, Laguna, Batangas, Rizal, and Quezon) had the most approved construction projects for that month accounting for 21.8% of the total with 3,350 permits.

This was followed by Central Luzon (17.5% share with 2,697 permits), and Central Visayas (7.9% share with 1,210 permits).

By value, Calabarzon cornered P8.96 billion worth of construction projects, followed by the National Capital Region (P7.82 billion), and Central Luzon (P6.61 billion).

The PSA said construction statistics are compiled from the copies of original application forms of approved building permits as well as from demolition and fencing permits collected monthly by the agency’s field personnel from the offices of local building officials nationwide.

Source: Business World

Luxury hospitality seen as growth niche for Philippine developers

Property consultants said residential oversupply could push more Philippine developers to pursue luxury hospitality projects.

“With over 7,000 islands, it has all the ingredients, but it seems that Philippine hotel developers are conservative,” Bill Barnett, founder and managing director of Thailand-based hospitality consulting group C9 Hotelworks, said in an interview.

Mr. Barnett, who has served as a consultant for various hotel and residential developments across the Asia-Pacific, said many of the Philippines’ hotels and resorts are “family-run, so they tend to look at the industry and do what their friends do.”

“If somebody does one thing, they all do it,” he added.

Mr. Barnett also noted that some hospitality developers tend to be “commodity minded.”

“Meaning, they think more is better. More rooms, more things… You can’t commoditize luxury because somebody else can come in and lower their prices,” he added.

He also noted the oversupply of condominium units in Metro Manila would prompt developers to shift to the luxury segment.

“I think, now with real estate being overbuilt, Philippine developers will have to find a niche,” he said. “The real estate situation in the country triggers more luxury…because of the oversupply.”

For a luxury hospitality development to be attractive, Mr. Barnett said it is important to have easy access to its location.

“You can’t stay there if you can’t get there,” he said. “There should be enough flights which make it attractive, not only for guests, but to transport staff, and even goods and services.”

He also noted that luxury hospitality properties must have a unique selling point, with many travelers seeking localized experiences. Mr. Barnett also cited the importance of unique food & beverage concepts, strong internet connectivity, and exclusivity of location.

Alfred Lay, director for hotels, tourism, and leisure at Leechiu Property Consultants, said there are over 35 luxury hotel projects ongoing in the Philippines, accounting for over 7,500 hotel rooms over the next four years.

“If you include projects which have yet to be announced, then the number climbs to 50 luxury hotels and adding over 10,000 high end room keys,” he said in a Viber message.

However, air access remains a key roadblock in making the Philippines a fully realized luxury destination, Mr. Lay said.

“If you’re a high-spend international traveler, you don’t want connecting flights just to get to your resort — you want to land straight into places like El Nido or Siargao. Where we’ve got international airports near tourist hubs, you’ll notice the luxury hotels follow, such as Mactan, Panglao Island, Boracay,” he added.

Joey Roi H. Bondoc, director and head of research at Colliers Philippines, said luxury hotels are expected to perform well amid high occupancy rates and the entry of foreign hospitality brands into the country.

“Even if foreign arrivals to the Philippines dropped marginally in the first five months of 2025, there’s still a healthy level of occupancy, especially in Metro Manila hotels,” he said via telephone.

In the first half of the year, five-star hotel occupancies remained steady at 67% from the same period in 2024. This comes as foreign arrivals in the Philippines remain below pre-pandemic levels at 2.54 million as of end-May.

However, Colliers noted that the Philippines has a 4% penetration rate of branded hotels, way behind Singapore (45%), Indonesia (10%), and Thailand (8%).

“I think it will take a few more years for the Philippines to be at par with Thailand, Singapore, of course, Indonesia, especially if you look at our recovery rate pre-pandemic,” he said.

Source: Business World

Corruption-tainted construction industry placed under DTI supervision

Trade Secretary Cristina Roque has assumed direct supervision of the Construction Industry Association of the Philippines (CIAP) “to restore integrity and transparency” amid allegations of irregularities in contractor accreditation.

In a statement on Wednesday, Roque said CIAP and its implementing boards, including the Philippine Contractors Accreditation Board (PCAB), would be placed under her direct supervision.

“Placing them under my direct supervision will ensure that order, transparency and accountability is restored within these agencies,” Roque said.

“Full transparency and cooperation are mandatory, and those who breach the trust and mandate entrusted to us will be held accountable,” she added.

Cleanup imperative

Roque said earlier the DTI would do a “major cleanup” at the PCAB, as the agency initiated a comprehensive investigation into numerous allegations of conflicts of interest, accreditation irregularities and potential abuses of authority.

The agency will thoroughly review the conduct of current PCAB members and officials and submit recommendations to President Marcos, including their potential removal from their posts.

PCAB is an attached agency of the DTI and one of CIAP’s implementing boards, tasked with promoting, accelerating and regulating the construction industry’s growth and development.