With a background in Silicon Valley, Michael McCullough co-founded KMC MAG Group to fill a gap in the Philippines real estate market. In 2013 the Group announced a new association with international real estate adviser Savills, who described the group as the fastest growing commercial and residential real estate service provider in the Philippines, with over 100 employees involved directly in transactions for office, retail, industrial and residential properties.  The agency won Best Property Consultancy Philippines 2015-16 in the Asia Pacific Property Awards.

How did you get into the real estate industry?
I was sent to the Philippines by the company I worked for in the US in 2007. My colleagues, Amanda, Greg and I were servicing international clients to help set up their companies here in the Philippines. Then we thought about setting up a real estate services business since that’s what we’ve been doing anyway. And the rest is history.

What are some of your career highlights from your time in the industry?
We’re proud that we’re nearly 8 years in the business.  When we were starting small, we had goals like leasing out an entire floor, then an entire building. Same with investments, we started selling office floors, then half a building, then an entire office tower. Now the highlights are watching your employees grow up, continue in their professional development, and make some life changing money.

What are the biggest issues facing the industry in your market at the moment?
There’s a serious lack of infrastructure.  The traffic here is a big issue and does impact the ease of doing business here. The government is taking steps and we are optimistic that it will be resolved soon.
 
How has the industry changed in the time you have been involved with it?
There are many more opportunities in the market now than there were even five years ago. There has been an influx of tenants from the BPO industry and many new developers who want to build offices. This creates opportunities for companies such as ourselves to help facilitate companies locating office space. Some developers who used to focus on residential buildings are now venturing into office buildings. 
 
What changes would you like to see over the next two to five years in the industry?
We think that over the next two to five years’ growth will not be as fast as it has been over the last few years. Despite this, we anticipate a steady growth rate that is positive for firms wishing to relocate here and also businesses like ours who can help businesses start up in the Philippines.
 
To aid new businesses in establishing themselves in the Philippines though, there need to be improvements in certain areas. As mentioned earlier, the traffic problem is a real issue and changes need to be made so that it’s quicker and easier to get around Metro Manila. There also need to be changes made to the rules on foreign ownership of businesses so that there can be more outside investment. At present, the current rules on foreign ownership of businesses can delay or prevent investment into the country.

What advice do you have for people who are just starting out in similar careers?
Work hard, use your network and build relationships.

In the Asian market in particular, relationship building is essential. People want to like and trust you whilst doing business with you and you have to care about each other’s goals. This is the difference between a successful and mutually beneficial project and one that fails.

There really is no substitute for hard work though; take time to plan for every eventuality as things can change quickly in this industry.

For someone starting out in real estate – it’s essential to build your network. Attend every networking event you can and talk to people. Take business cards and email addresses and get to know people in the industry. You never know who you might meet and how you may end up assisting each other.
 
It also pays to get to know the industry well - what’s happening to the market, what the trends are, etc. This helps clients in making informed decisions. 
 
What do you believe is a unique factor of doing business in your market?
There’s a small pool of professionals doing what we do, and it’s important we hire and retain the best.  Our brand promise is that we offer non-biased advice, we deliver high quality research materials from a team run by Antton Nordberg, and getting market data in a non-transparent market is also a challenge.

What is your favourite holiday destination in Asia?
I love visiting the beautiful islands here in the Philippines. There are over 7,000 islands here and each one has its own natural beauty. My favourite island here though is Palawan. It is recognised as one of the most picturesque beaches in the world and it’s well worth a visit. Clear blue water and white sands, it’s a great holiday destination. There’s always something new to see and explore here in the Philippines.  If you want your own private island we’re selling one!
 
What’s your outlook for your sector/s for the next year?
All sectors are having good demand this year. Prime office areas, particularly in Bonifacio Global City, will have fantastic new developments such as the ArthaLand Century Pacific Tower and the Inoza Tower. Residential prices continue to increase. Demand for industrial and logistics is quite high to keep pace with the demand in retail.

Where would your next purchase be?
Definitely in residential and in Bonifacio Global City.  Bigger units, like 2-3 bedrooms, are in high demand and you have yields ranging from 3.5% (luxury property) to 8% for mid-end developments.  There are also opportunities in strata office space but the inventory is limited.

More from Michael and KMC MAG Group

Cebu City: Office Property Briefing 

Real estate industry seen to grow with new economic agenda

Philippine Real Estate Outlook 2016

The Millennial Impact