Market Analysis

Entry Barriers Most of the biggest players in this perseverance be those companies which be tied up with banks. Robinsons agriculture is backed up by Robinsons Bank, Filinvest Asia potbelly. joints with Filipino Bank of Communication, Federal Land is a member of the Metrobank group of companies, Banco De Oro and SM Development Corp are under SM group, Ayala Land ties with Bank of the Philippine Is records, just to name a few. The big names that these institutions harbor are an initial holy terror to new entrants. Moreover, with the mass of monetary resource that banks break, they depart have the ability to procure and pick out huge land parcels and have their real estate increase partner produce extensive income through condominium and perpendicular development projects. Land acquisitions by banks are from collaterals served by give borrowers. When a debtor is unable to pay his loan, the asset make out out then be possessed by the bank, and then are set for development. The greatest blockade as a threat of entry is the huge capital requirement for the industry.

For instance, to complete iodine condominium project of about 34 floors with 286 single bedroom, 78 double bedroom and 136 single parking slots saleable units Makati CBD, it will take land area of 1,670 square meters with an appraised cost of Php60M, Php950M of structure materials and engineering costs, Php7M licensing expenses, Php37M of professional fees. These costs can sum up to over Php1B just for one project. Those who have access to such a sum of financial resource will have the ability to develop projects. Selling and marketing expenses are non yet included with this budget. This threat to new entrants is an advantage of financial institutions because banks have enormous reservoir of money to fund extravagantly costing projects as land developments. Those who have seen the potential of this industry decades back took the wise decision of investing in land properties because they have perceived that the value of land will... If you want to get a full essay, order it on our website: Ordercustompaper.com

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