Opportunities for developers in int’l market

The country has a strong cluster of developers who are currently developing mid-range to luxury projects around the country. However, most domestic developers have focused only on the local market and not used the opportunities in the international market efficiently.

South Korea and the Philippines are two such countries that are currently considered as the world’s leading emerging nations. Investing in these countries would provide an opportunity for long-term inward remittances for Sri Lanka, as a whole, and the development firm.

The Philippines is similar to Sri Lanka in terms of GDP with a growth rate of over seven percent. The country is currently a platform for several international real estate development projects. According to data obtained from Lamudi Philippines, the average condominium price per square foot in main cities such as Manila, Makati and Quezon City is almost equivalent to the average luxury condominium price range in central Colombo.

According to a report published by Jones Lang LaSalle in August 2014, luxury condominiums in central Colombo range between Rs. 35,000 to Rs. 45,000 per square foot. This shows that local developers who construct mid-range houses in Sri Lanka could get higher returns by investing in similar projects simultaneously in the Philippines, although, there will be additional barriers to entry such as laws, competition and cost of construction.

The government invites international investors to take note of the potential of Sri Lanka’s real estate market to create more inward remittances. However, local developers investing in countries with an appreciating currency is also a potential for increased inward flow of funds.

An added benefit of investing in other countries would be ownership of property. Although, this benefit is quite rare, it is one of the most rewarding investment options.

Investing in a developing nation would provide better returns, either through resale or development of a project, when the real estate market life-cycle steps into the growth stage.

The Sri Lanka branch of Lamudi, the real estate portal, was opened in May 2014. The company is represented in 32 countries across Asia, Africa, the Middle East and Latin America, with over 900,000 real estate listings across its global network. The portal offers sellers, buyers, landlords and renters a secure and easy-to-use platform to find or list properties online.