Building smarter, greener offices is the way to go

Smarter and greener buildings are fast becoming the norm in the Philippines, with more and more property developers taking action to address climate change and to embrace the available advanced technologies.

The building and construction industry has been continuously evolving to cater to the ever-changing environment. Sustainability initiatives, smart technologies, and increased safety standards for occupiers’ well-being have been shaping the transformation of new buildings’ design and features.

The industry has a significant impact on the economy, society, and the environment. It plays a crucial role in the economy, driving jobs and growth. An article published by Industry Tap noted that the building and construction industry accounts for about 13% of the global gross domestic product (GDP).

The construction and building industry touch every kind of business: it provides shelter, infrastructure, manufacturing facilities, and many others. The quality of the buildings it produces leaves a lasting impact on the lives of people.

Amid continued expansion and growth, its environmental impact cannot be left unnoticed as it accounts for 39% of carbon emissions. This figure is alarming and calls for an improvement in the quality of construction and the materials used. The unprecedented global pandemic has contributed to the acceleration of innovation across industry.

These innovations have given rise to key trends shaping the construction industry. These trends focus on sustainability initiatives, well-being, and the integration of smart technologies into the building management system.

Looking at the Philippine construction industry, it can be observed that the country is steadily keeping up with the trends. Many buildings now are becoming more digitized and have more sustainable features not just to reduce cost but also to lessen their carbon footprint.

Many domestic players are also exploring the potential benefits of incorporating artificial intelligence and machine learning to their building management systems (BMS). Artificial intelligence, for instance, can be used in crucial building operational systems, such as energy management, enhanced HVAC system for optimal comfort, and predictive maintenance.

Aside from artificial intelligence, sustainability features are also a major consideration for real estate developers. Being a sector with the largest contribution to greenhouse gas emissions, it is safe to say that the real estate industry has a responsibility in creating a greener and more sustainable built environment.

As the world transitions to a new normal, the building and construction industry is also transforming to cater to the needs and ensure the well-being of their building users. Returning to a safe workplace is now one of the top considerations; therefore, developers are investing more in innovations that will not only ensure productivity but will also provide a sense of safety. One such innovation is contactless or touchless systems, such as sensors, access cards, and facial recognition software. These features will help lessen the risk of transmission not only of the COVID-19 virus but also other pathogens.

To further promote sustainability, there are a number of globally recognized green building certifications that building owners and developers can take advantage of as a way to reduce their properties’ environmental impact. Aside from affording their client-occupiers the appropriate credentials to satisfy their ESG (Environmental, Social, and Governance) standards, many are now attributing the importance of green and sustainable buildings to staff productivity, health, and overall happiness.

Sustainability in the built environment is not just an option, rather it is now a must-have. We believe that the future of office buildings leans towards creating spaces that are safer and healthier with minimal impact on the environment. Many studies have shown that green and sustainable buildings not only have an impact on any business’ balance sheet, they also have lasting benefits on people and the communities where they are located.

Colliers Philippines believes that the development of greener and more sustainable spaces will be the norm moving forward. The pandemic has highlighted the need for these spaces. Sustainability will play a crucial role as we lure more employees to report back to traditional office spaces.

The rise of green and sustainable buildings is also evident in the Philippines. Local developers have successfully integrated green and sustainable features and have acquired green certification from different international organizations such as the LEED certification by US Green Building Council (USGBC) and EDGE by International Finance Corp.

Notable green and sustainable feature of LEED/ EDGE certified buildings in the Philippines include water and energy efficient technologies such as vertical green wall, a rainwater harvesting system, green roof, and double-glazed glass curtain walls for increase energy efficiency.

Additional smart features that make the buildings more resource efficient is the BMS that cuts energy expenditures and consumption. Aside from offering top-notch office spaces and amenities to its occupiers, developers can also take note of these features especially if they are planning to be more resource efficient, acquire green certification and leave a lasting positive impact on the built environment.

Source: Business World

ADB keeps PHL GDP forecast at 6.5%

The Asian Development Bank (ADB) has retained its growth forecast for the Philippines for this year, citing a strong rebound in domestic demand as the economy continues to reopen despite growing inflation risks.

In its Asian Development Outlook (ADO) 2022 Update report released on Wednesday, the multilateral lender said it expects the country’s gross domestic product (GDP) to grow by 6.5% this year, steady from its July forecast.

However, this is at the lower end of the government’s 6.5-7.5% target for this year.

Philippine GDP expanded by 7.4% in the second quarter, slowing from the 8.2% seen in the previous quarter. This brought the first semester average to 7.8%.

“The normalization of socioeconomic activity will usher the Philippine economy to a steady, pre-pandemic pace of expansion,” ADB Philippines Country Director Kelly Bird was quoted as saying in a statement.

“The recovery in tourism and private investments, coupled with sustained public spending on large infrastructure projects and remittances from overseas Filipinos, will bolster the country’s economic recovery this year.”

At 6.5%, the Philippines is expected to be the fastest-growing economy in Southeast Asia this year, along with Vietnam. This forecast is also above the ADB’s 5.1% growth outlook for the entire region, which was raised from 5% in July.

However, the ADB now expects Philippine inflation to average at 5.3% this year, up from the July forecast of 4.9%, due to “sharp upward shocks to global energy and commodity prices” and “the negative impact of natural disasters on domestic agricultural supply [that] will likely lead to higher food prices until the end of the year.”

“The import-dependent economies have been hit hard simply because, across the region, import bills have ballooned, more so for the smaller economies,” ADB Senior Regional Cooperation Officer for Southeast Asia Dulce Zara said.

“Price increases coupled with weaker local currencies, it has inflated their import bills,” she added.

The central bank sees headline inflation averaging 5.4% this year, well above its 2-4% target.

Headline inflation eased to 6.3% in August from a near four-year high of 6.4% in July, bringing the eight-month average to 4.9%.

Ms. Zara also flagged risks from China’s slowdown, especially since it is among the Philippines’ top trade partners.

Meanwhile, the ADB also kept its Philippine GDP growth forecast for 2023 at 6.3% “as monetary policy tightening and accelerating inflation both crimp domestic demand.” This is the second-fastest forecasted expansion in Southeast Asia for next year, following Vietnam’s 6.7%, and is below the official target of 6.5-8%.

It likewise maintained its inflation forecast of 4.3% for next year “since the return to steady economic growth will keep inflation relatively stable, and with energy prices likely to decelerate.”

Abdul Abiad, director of ADB’s Macroeconomic Research Division, said central bank policy rates are expected to continue rising to counter inflation and to support weakening currencies due to the dollar’s strength amid the US Federal Reserve’s tightening cycle.

“The peso has depreciated by about 13% so far… [but] the Philippines is not at the extreme end; it’s very much close to the average for the region,” Mr. Abiad said. “Much of the depreciation in the Philippine peso reflects, not so much weakness in the peso, but strength in the dollar, driven by the Fed tightening.”

The Bangko Sentral ng Pilipinas (BSP) has hiked borrowing costs by a cumulative 175 basis points since May, and is expected to continue hiking rates to rein in rising inflation.

On Wednesday, the peso closed at a new low of P58 per dollar, down by 52 centavos from the previous day, as markets awaited the Fed’s decision overnight.

Year to date, it has lost 13.73% in value against the greenback, making it one of the region’s worst performers.

Aside from inflation, which it mostly attributed to the Russia-Ukraine conflict, the ADB said other risks to growth, include a sharper slowdown in major advanced economies and heightened geopolitical tensions.

DEVELOPING ASIA

Meanwhile, the ADB cut its growth forecast for developing Asia this year and 2023, amid tighter global monetary policy, the Russia-Ukraine conflict, and the lockdowns in China due to the coronavirus disease 2019 (COVID-19).

The ADB downgraded its 2022 growth outlook for developing Asia to 4.3%, slower than the 4.6% projection in July.

In 2023, developing Asia is projected to expand by 4.9%, down from the previous 5.2% forecast.

“Domestic consumer spending and investment are driving growth as economies in the region continue to relax pandemic restrictions, thanks in part to vaccination drives and declining COVID-19 mortality. However, the continuing invasion of Ukraine has heightened global uncertainty, worsened supply disruptions, and unsettled energy and food markets,” the ADB said.

“More aggressive monetary tightening by the US Federal Reserve and the European Central Bank is denting global demand and rattling financial markets. Meanwhile, sporadic COVID-19 outbreaks and new lockdowns have slowed growth in [China], the region’s largest economy,” it added.

Excluding China, which is also challenged by a weak property sector, the rest of developing Asia is projected to grow by 5.3% in both 2022 and 2023.

“This will be the first time in more than three decades that China will be growing slower than the rest of developing Asia. In other words, it’ll be a drag on growth rather than an engine of growth for the region,” said Mr. Abiad in an episode of ADB Insight released on Wednesday.

ADB Chief Economist Albert Park said while the region has seen some recovery, risks still “loom large,” including slower global growth that could affect exports, as well as aggressive monetary tightening that could lead to financial instability.

Source: Businessworld

Asia Must Improve Digital Environment for Entrepreneurs

Four-fifths of developing Asian economies place toward the bottom in a global ranking of digital environments and support systems for entrepreneurs, according to a new index developed by the Asian Development Bank (ADB).

Singapore has the world’s best digital environment and support system for entrepreneurs, according to the Global Index of Digital Entrepreneurship Systems, released today as part of the Asian Development Outlook (ADO) 2022 Update. The United States ranks second, while Sweden takes third place among 113 economies on the list. But 17 of the 21 developing Asian economies included are ranked toward the bottom—underscoring the need for many of them to nurture digital entrepreneurship.

Digitalization offers big growth opportunities for businesses in Asia and the Pacific. It’s a driver of innovation, which is key for economies striving to achieve high-income status. It can also make economies more resilient, as seen when digital technology helped many businesses survive the COVID-19 pandemic, and it can promote inclusive growth by lowering the cost of starting a business.

“Digital entrepreneurship helped economies stay afloat during the COVID-19 pandemic, and it can become a major engine of growth and innovation in the post-pandemic world,” said ADB Chief Economist Albert Park. “For this to happen, there needs to be a supportive environment enabled by conducive policies and incentives. While the environment for Asia’s digital entrepreneurs made substantial strides in the past couple of years, there’s still a lot of room for improvement.”

The index measures the quality of the environment for digital entrepreneurs by looking at the level of digitalization in eight areas: culture, institutions, market conditions, infrastructure, human capital, knowledge, finance, and networking.

In addition to investing in digital infrastructure such as broadband networks, governments need to promote political stability, reliable legal systems, open and competitive markets, and strong property rights. An ADB analysis shows that strong rule of law has a positive effect on enterprise innovation, while less corruption in a society is correlated with an increase in the entry of new entrepreneurs in the market.

For Asia and the Pacific as a whole, an insufficiently supportive culture is among the biggest weak spots when it comes to nurturing digital entrepreneurship. One example is a general lack of public appreciation for the vital role that entrepreneurs play in economic progress. One way to change this is to improve the public perception of entrepreneurship through education.

Global Index of Digital Entrepreneurship Systems Scores

Source: ADB