Philippines among top 10 improvers in Global Real Estate Transparency Index
JLL’s latest Global Real Estate Transparency Index marks solid improvement across Southeast Asia; Asia Pacific real estate transparency makes largest gains globally
Asia Pacific’s emerging markets have made the most significant gains in improving real estate transparency, led by a greater emphasis on corporate social responsibility and wider adoption of new technologies. According to JLL’s biennial Global Real Estate Transparency Index (GRETI), Southeast Asian countries like Thailand, Vietnam, Philippines and Indonesia are among the global top 10 improvers, while Singapore continues to feature prominently as a transparent market.
The 2020 Index is launched at a time of massive economic and societal disruption where the need for transparent processes, accurate and timely data and high ethical standards are in closer focus. The backdrop of COVID-19 is also ensuring that transparency within Asia Pacific’s real estate legal and regulatory systems is more important than ever to global investors, as they look to deploy approximately $40 billion* in dry powder capital into the region.
According to JLL, pressure exists from investors, businesses and consumers to further improve real estate transparency to compete with other asset classes and meet heightened expectations about the industry’s role in providing a sustainable and resilient built environment in the age of COVID-19. Furthermore, innovative new property technology (proptech) is changing how real estate data is gathered and analyzed and influencing industry transparency at a regulatory level.
“While investment into commercial real estate has inevitably paused during the pandemic, the overarching trend toward rising allocations to this asset class will continue. As investors look to allocate more capital into real estate in this region, transparency becomes even more important, as will the enforcement of robust regulatory frameworks,” says Regina Lim, Head of Capital Markets Research, Asia Pacific, JLL.
Philippines remains in “semi-transparent” tier
Ranked at 45th spot in the 2018 edition of JLL’s GRETI, the Philippines climbed one spot to 44 out of the 99 countries and 163 city regions included in the study, making it one of the top 10 global improvers (vs 2018).
Emerging markets have once again shown the greatest advancement in the Index, with six Asia Pacific markets – Mainland China (32nd), Thailand (33rd), India (34th), Indonesia (40th), Philippines (44th) and Vietnam (56th) – among the top 10 biggest improvers globally. Progress in Thailand’s and Vietnam’s main cities, Bangkok and Ho Chi Minh City, has pushed each into a higher tier – ‘Transparent’ and ‘Semi-Transparent’ respectively. Singapore (14th) sits near the cusp of the ‘Highly Transparent’ tier as it has risen one spot from number 15 in 2018.
“Sustainability, including a rise in the number of green-certified buildings, contributed to the Philippines’ improvement. Developer focus on sustainability in the Philippines will be further boosted by the Energy Efficiency and Conservation Act 2019, which includes guidelines on energy conserving design on buildings,” said P. Ryan Isip, JLL Philippines’ Head of Capital Markets.
“The Philippines has also undertaken an initiative to digitize the land registry, leading to better quality records and easier access,” he continued.
In both Asia Pacific and outside of the region, JLL’s research concludes that sustainability commitments have become the biggest single driver of real estate transparency globally since 2018. An increased focus on corporate social responsibility and acknowledgement of the need to create sustainable buildings bring environment, social and governance (ESG) considerations into the mainstream. Additionally, green building certification systems and energy efficiency standards are widespread in the region’s most transparent markets and the most improved national real estate sectors.
Rise of proptech platforms to drive transparency
Another key driver of transparency is the volume of real estate market data now available due to the growing adoption of proptech platforms, digital tools and “big data” techniques. Although real estate markets have historically faced challenges when implementing new technology, the COVID-19 pandemic is leading to an acceleration in new types of non-standard and high-frequency data – especially relating to health, mobility and space usage – being collected and disseminated in near-real-time.
“As the adoption of proptech and sustainability commitments continue to garner steam, greater transparency gains will be driven by both an evolving regulatory landscape and the collective actions by national real estate industries. With the outbreak of COVID-19, it will become even more crucial for the real estate industry to work collaboratively with local governments to achieve greater transparency and meet the changing expectations of investors as their appetites shift in accordance to the investment outlook over the next 12 to 18 months,” says Chris Fossick, CEO, JLL Southeast Asia.
JLL and LaSalle have been tracking real estate transparency and championing higher standards since 1999. This latest survey has been extended to quantify 210 separate elements of transparency, with additional coverage on sustainability and resilience, health and wellness, proptech and alternatives sectors. Download it here.
JLL has been operating in the Philippines since 1997 as a 100% wholly-owned entity and currently manages about 5.3 million square meters of real estate with a workforce of over 1,300 employees. With more than two decades of local expertise working hand-in-hand with its global legacy, JLL provides to the Philippine real estate market an unparalleled synergy of services with a strong commitment to achieve real estate ambitions through future-ready approaches. For further information, visit www.jll.com.ph.
JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. JLL shapes the future of real estate for a better world by using the most advanced technology to create rewarding opportunities, amazing spaces and sustainable real estate solutions for our clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of $18.0 billion, operations in over 80 countries and a global workforce of more than 94,000 as of March 31, 2020. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit jll.com.