Construction, shipments to take a hit if virus spreads further, say Philippine property firms

It's business as usual for the Philippine property sector amid the coronavirus disease 2019 (COVID-19) situation, but the construction of new projects and the shipment of supplies may take a hit should the situation get worse, industry leaders said Wednesday.

A large percentage of raw supplies used for construction comes from China, the epicenter of COVID-19—which has caused a dent in the country's manufacturing sector, they added.

Cathy Casares-Ko, executive vice president at Federal Land Inc., said that shipments are expected to come in as scheduled, as most plants in China have started to resume operations.

"In terms of supply of raw materials to be used for our buildings, we're good at this moment, so we have to check that again because China has already started to manufacture again," she said at Lamudi's The Outlook roundtable Wednesday.

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"The companies, they opened up again, and there's not a lot of impact because this thing happened in China during the Chinese holidays so the plants were really closing down, so the effect was not a lot," elaborated Ko. China extended the Lunar New Year holidays and only resumed regular work on February 10.

Should the virus spread further in the Philippines, Ko said construction will take a hit.

"What we're watching out for though, it this disease spreading locally because it might affect our construction workers, and then if we don't have workers, constructing our buildings then we will be delayed," she said.

"We have not seen any of that happening yet. Maybe it's too early, but we are already monitoring so our construction teams at the various sites are monitoring manpower development to see if there are any significant changes," she added.

The Philippines has so far recorded a total of 33 confirmed COVID-19 cases, with a public health emergency already raised.

The entry of raw materials into the Philippines may also be hit as local ports have been reported to block imports from China, according to Phinma Property Holdings Corporation.

"Apart from manufacturing, what I'm worried about is now actually shipments... I'm not sure which [port], but they're banning ships from China, so those are the things that might affect us," said Phinma president and CEO Raphael Felix.

"Work is a big thing right now, with the way this thing is accelerating locally. Hopefully not, but the major effect of all this to us is in our income statements," he explained.

Phinma's accounting system is based on percentage of completion, and so sales are not recognized as revenues if the project is unfinished. — BM, GMA News