Phil Star, 07/12/09

The world’s greatest cities are driven by their economies. Business and commercial activities in all modern communities and metropolises that produce urban wealth rely historically on three key physical ingredients—good infrastructure, a prominent main street and a vibrant central business district. The success of global sites and cities depends on how well these elements accommodate transactions and connect businesses to customers, to each other and to the world.

New York has its Wall Street and lower Manhattan, which is filled with multi-national corporate head offices and global bank headquarters. Paris has its iconic Champs-Elysées and La Défense business district. Singapore has its Shenton Way and the island state’s downtown business district west of the Singapore River.

Metropolitan Manila has its own version of this morphology of economic and commercial power—Makati. The original center was south of the Pasig River, Binondo with its main street, the Escolta, was where the country’s main businesses set up shop; including a trading and tranvia-operating firm run by the Zobel family. The city’s post-war expansion, however, needed more space and proximity to the then emerging preferred mode of transportation that was air transport.

From Grass to Glass

In the late 1940s the Ayalas cleared open fields and swampy patches around an old airport and near a newly expanded nearby one—Nichol’s Field. They offered it as an alternative to the crowded old business district of Binondo, which was by then saddled with choking traffic and lack of space for expansion.

Businesses moved to the site, attracted by the large parcels available, by the complete infrastructure of roads and utilities, and an excellent program of maintenance. All this was provided by Ayala, along with an environment of development control, unheard of in the country, which ensured land values for investors by regulating that no incompatible developments be allowed nearby as well as by setting a high standard of architecture.

Ayala Land’s winning formula for creating central business districts is evident with the development of modern Makati from the late 1940s to what it is today, the premier business address of Metro Manila. This formula is based, aside from the infrastructure mentioned above, on the classic combination of a main street—the wide Ayala Avenue, and a business district built on both sides of it—today’s Legazpi and Salcedo clusters.

The Ayalas built on the original formula and improved it by adding exclusive housing enclaves. They started with Forbes Park, which is the millionaire’s row of the metropolis. This was followed by the now famous “villages” of Bel Air, San Lorenzo, Dasmarinas and Magallanes. Unlike earlier residential developments in Manila, these residential developments were provided with parks and open spaces, amenities that drew the old established rich as well as an emergent upper middle class to move to the district.

To complete the formula Ayala built a commercial center in the early ’60s, which was the first integrated shopping complex in the country. It had supermarkets, cinemas, department and specialty stores; all woven together by lushly-landscaped pedestrian malls.

Ayala Land’s combination of business and residential districts supported by retail, recreation and entertainment amenities was decades ahead of its time. The whole “work, live, play” paradigm as a standard development approach would only emerge in the 1990s, by which time, Ayala Land (by the early ’80s, the acknowledged leader in real estate development) had honed its comprehensive formula to match the context of an expanding Metro Manila and increasing globalization of business.

Makati, as the premier urban district of the nation’s capital, is still evolving. This is evident in the continuing improvement of its urban design. The district was first to incorporate an extensive elevated walkway, underpasses and covered arcade system for pedestrians. It also was the first to provide a rational in-city one-way traffic and parking system.

Makati is far from filled up. The infrastructure of the district is being upgraded to accommodate high-quality, higher-density development. The skyline of Makati is changing fast with even more corporate and residential skyscrapers on the drawing boards. This concentration augurs well for the future of Makati and the businesses that chose to locate there.

Locating Success

Location has always been the mantra for investors and, well, locators. Makati’s winning location is now replicated using the winning formula of urban development by Ayala Land and adapted to two other sites, Bonifacio Global City in Taguig, and Nuvali in Sta. Rosa and Calamba, Laguna. For each new site, Ayala Land has learned and improved on the building blocks for success used in Makati to achieve sustainable investment values pioneered there.

Ayala Land’s development in Bonifacio Global City together with its partners, Evergreen Holdings Inc. and Bases Conversion and Development Authority (BCDA), uses the template of infrastructure, a main street and a well-defined central business district. Bonifacio High Street is the main street of this new district. It is a “green” avenue, 40 meters wide and lushly landscaped. When complete it will be one kilometer long like its predecessor Ayala Avenue. Bonifacio High Street is the central spine that connects two key clusters of the district — the Serendra and Market, Market cluster that is almost fully complete as well as the Mind Museum and Shangri-la Hotel complex at the other end.

In between and on both sides, again like the original Makati, are future parcels of land that is already seeing an increase in construction activity. In the meanwhile, the district is already well known as a venue of choice for concerts, events and related arts and culture activity.

Bonifacio High Street already has created a buzz and actual sense of place that makes it an attractive investment opportunity and an ideal location for purpose-built commercial developments as well as mixed-use vertical complexes, including high-end residential condominium development.

Finally, Bonifacio Global City is as well connected as the original Makati, with direct access to C-5, the airport and points south via the soon-to-be-completed SLEX.

Southern Perspective

The south is, in fact, the premier growth corridor for the metropolis. Ayala Land is replicating their tried and tested template for development there with Nuvali. The context is slightly different from the original Makati or Bonifacio Global City. This difference is one of scale as Nuvali can fit five Makati CBDs. The similarity, however, is that, even this early, land values have shown the same trajectory as the other two sites—that of a steady and sustained rise.

Rising up in this new valley of dreams is a dream city with the three main elements of excellent infrastructure, a central spine road and a central business district that will serve the needs of the region in the decades to come. This southern region of urban and suburban growth has the added advantage of closeness to leisure destinations of mountains (Tagaytay) and the beach (Batangas). It is akin to San Francisco merged with the attributes of Marin County and the verdant Napa Valley—an intoxicating mix of investment opportunity, lifestyle choices and what will be the address of choice of the future.

Back to the future and the original Makati urban district itself has not stopped evolving and is continually being improved and enhanced in terms of green amenities, pedestrian-friendliness and the quality of public spaces and architecture. The Makati CBD has not stood still with room for new locators, iconic building and improvements in its urban design. It continues to be the center of an expanding metropolitan Manila, a nexus for business and the preferred site for success.

It is this success, built on Ayala Land’s tested formula, that is the avenue of the future—for all the three sites—Makati, Bonifacio Global City and Nuvali. It is a road well travelled, well paved and well worth investing in or locating on. From the perspective of progress, profit and potential, this formula has and will be the key to any real estate development’s future.