Construction in the Philippines – Key
Trends and Opportunities to 2016
Reference Code: CN0080MR
Published: April 2012
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EXECUTIVE SUMMARY
1 Executive Summary
Infrastructure construction was the largest market in the Philippine construction industry in 2011, accounting
for a share of 37.0% of the total industry value. The Philippine infrastructure construction market recorded a
compound annual growth rate (CAGR) of 7.36% during the review period (2007–2011). This growth was
supported by the country‘s State-of-the-Nation Address (SONA) infrastructure projects, which were mostly
completed by the end of 2010 and the beginning of 2011. The energy and communication infrastructure
category is expected to be the main growth driver of the infrastructure construction market over the forecast
period (2012–2016), due to the Transmission Development Plan (TDP) initiated by National Transmission
Corporation. This project involves an investment of US$850 million to develop existing transmission
infrastructure and construct additional transmission infrastructure, and the project is expected to be completed
by 2015.
The country‘s expanding population has created a rising demand for housing, especially multi-family housing.
This has created a housing backlog of 6 million in the country. With the Philippines‘s rapid urbanization, the
country‘s housing dynamics are gradually changing. In larger towns such as Manila, an increase in the
demand for multi-family housing is being observed, as it is a cheaper option than single-family housing. Due
to the high demand for residential buildings, the Philippine residential construction market is projected to
increase in value at a CAGR of 4.81% over the forecast period.
Commercial construction was the third-largest market, with a share of 18.2% of the Philippine construction
industry value in 2011. However, the market contracted in value and recorded a CAGR of -0.40% during the
review period. This decline was caused by the decreasing demand for office spaces during the economic
crisis in 2008 and 2009, since the office building was the largest category in the commercial construction
market. In 2011, the office building category accounted for a share of 51.8% of the total commercial
construction market value. The country‘s expanding population will benefit the commercial construction
market, as it will generate a higher demand for retail and office buildings alongside the country‘s growing
economy and increased industrial activities. Due to the strong growth ant