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Rizal Avenue real estate story

Rizal Avenue, used to be called Avenida Rizal and the longest national road befo
re EDSA was built, still remains full of history, although admittedly could fade
into obscurity soon if not for the efforts to revive it.
With the fairly recent prominence of shopping centers located in posh areas else
where in Metro Manila, the prospects for the revival of Rizal Avenue's previous
stature as an economic center are not very encouraging.
It seemed in previous years that this area, once the downtown of Manila where ev
erybody went to shop and have fun, could no longer recover from the gloom that t
he Light Rail Transit (LRT) has brought upon it some decades ago.
Since the government chose to build the LRT in pursuit of an efficient transport
system that will decongest a growing metropolis, the curse that an elevated rai
lway system brings has been cast and had gradually crept into the famous avenue
it was built on, driving away businesses which lost their clientele to the shopp
ing malls.
But residents in this area appear to hold on to the old memories that Rizal Aven
ue brings, helping this area keep some of its charm over citizens who have only
fond memories of this place while they were growing up.
Perhaps these fond memories, together with the efforts of the government and the
private sector to clean up Rizal Avenue, are the ones that still keep the hopes
alive that this historical avenue can regain some of its lost glory.
It helps that real property around this area is still considered as prime proper
ties.

Market values for taxation purposes


According to the City of Manila's assessor, the properties along Rizal Avenue an
d adjacent areas are owned still by the old owners because they don't really wan
t to sell those prime properties.
Even for taxation purposes, the market values of properties in the area are stil
l high and have appreciated through the years. These properties could fetch even
higher prices in an actual sale since market values for taxation purposes are o
f common knowledge to be lower than the actual fair market values.
"But nobody really wants to sell these properties," said Manila City Assessor En
gr. Jose V. de Juan. "If you look at the area, the owners of the properties ther
e are still the old owners."
De Juan said that the buildings may have already turned old, but the lots are st
ill considered as prime lots, and have not depreciated in value, despite the glo
om and bad reputation that the existence of the LRT had brought upon the area.
The LRT appears to cut off sunlight from businesses in the area, making the surr
oundings dark even during the day and conducive for thugs and criminals to ply t
heir trade.
But market values have not gone down despite this. According to the latest Sched
ule of Base Unit Values for Residential, Commercial and Industrial Lands in the

City of Manila, market values of lots in this area have kept in pace with those
of other areas in Metro Manila.

Assessed values in 1979, 1983, 1996 vs. present


For instance, market values for purposes of computing real property tax of prope
rties in the Carriedo area along Rizal Avenue are pegged at P70,000 per square m
eter as of 2014. This has steadily gone up since 1979 (when it used to be only P
6,500 per square meter); 1983 (P9,700 per square meter); and 1996 (P31,710 per s
quare meter).
In the area adjacent to Ongpin Street in Sta. Cruz, the market values are at P10
3,000 per square meter as of 2014. This is a steep climb from market values in 1
979 (when it was only P3,100 per square meter); 1983 (P4,960 per square meter);
and 1996 (P21,330 per square meter).
In the historical area of Plaza Miranda, market values of properties in 2014 are
at P103,000 per square meter. In 1979, the market values of properties in Plaza
Miranda were only P6,000 per square meter. This went up to P9,700 per square me
ter in 1983, then to P41,710 per square meter in 1996.

Avenida zonal values vs. other areas


Even in the zonal values used by the Bureau of Internal Revenues (BIR) in comput
ing capital gains tax due on lots sold in the Rizal Avenue area, the zonal value
s are even higher than those of lots in the area of Aurora Boulevard in Cubao, Q
uezon City.
Zonal values of commercial lots along Aurora Boulevard reach only a maximum of P
50,000 per square meter as of May 2015, while zonal values of commercial lots in
the Ongpin area in Sta. Cruz reach a maximum of P91,410 per square meter.
These high zonal values for commercial lots in the Sta. Cruz area already appear
to rival the zonal value of commercial lots in the Forbes Park and Dasmarias Vill
age area (those along EDSA and McKinley Road) in Makati which is pegged at P100,
000 per square meter.
This is probably the reason why the old shopping mall Isetann is not folding up,
nor the prime lot it is built on is for sale.

Present fair market values


Due to the paucity of sale transactions involving real estate in the Rizal Avenu
e area of Manila, it is hard to pinpoint an exact figure regarding the fair mark
et values of the properties in the area.
This is because the history of sale for the past three years, or the history of
purchase prices in sale transactions in the area, is one of the factors in deter
mining fair market values, according to Leo Hernandez, a former president of the
Philippine Association of Realtors Board (PAREB).
Another factor that contributes to the fair market value of a particular propert
y is the possible utilization of the property, factoring in the properties and i
mprovements adjacent to the property subject of the appraisal.

According to Institute of Philippine Real Estate Appraisers (IPREA) President Le


o Albano, the LRT could still have some positive effects on the fair market valu
es of properties along Rizal Avenue, especially those properties near the train
stations since the proximity to the train stations makes it more convenient for
residents in the area to get to their workplaces elsewhere in the metropolis.
Albano said that properties near the train stations are generally 20 to 30 perce
nt more valuable than other properties that are farther away, given that other f
actors, such as the utilization and improvements of adjacent properties, which a
ffect the appraisal of a particular property are the same.
Likewise, a study conducted by an online property portal indicated that properti
es close to train stations are about 15 percent more expensive than condominiums
that are less than a kilometer away, as railways are still considered the faste
st transportation mode in Metro Manila despite their deteriorating state.

Historical premium?
It is arguable whether a historical background of a particular property could ac
tually put a premium that would make the fair market value of that property unus
ually high.
Hernandez said that sometimes the price of a parcel of land on which a historica
l building stands could be boosted by its historical background. He cited the re
sidence of former President Jose P. Laurel along Shaw Boulevard in Mandaluyong C
ity which was sold to former Senator and another Nacionalista Party stalwart Man
uel Villar as an example of a parcel of land that has appreciated in price faste
r due to its historical background.
However, some appraisers would disagree as to the premium to be given to some of
the old buildings along Rizal Avenue, which were built way back during the Amer
ican occupation.
During the heyday of the "bodabil" era, or the local adaptation of vaudeville wh
ich is the theatrical genre of variety entertainment in North America in the lat
e 1800s up to the period before World War II, there were many art deco architect
ure built along Rizal Avenue, most of them designed by renowned architects and N
ational Artists Juan Nakpil (1899-1986) and Pablo Antonio (1901-1975).
Nakpil designed, among many others, the Avenue Theater (demolished in 2006) and
the State Theater (demolished in 2001), both formerly found along Rizal Avenue.
Antonio, on the other hand, designed the Ideal Theater (demolished in the 1970s)
and the Scala Theater (which is still standing but is in a dilapidated conditio
n).
According to the National Historical Commission of the Philippines (NHCP), these
theaters along Rizal Avenue, back when it was still called Avenida Rizal, used
to be the venues for theatrical performances, then they were converted to become
movie houses during the 60s and the 70s when the Philippine movie industry flou
rished.
The storied Capitan Pepe Building, designed by Nakpil in the 1930s and still sta
nding at the corner of Claro M. Recto Avenue and Rizal Avenue, used to house "Th
e Moonlit Terrace" and "The Central Hotel" which used to be popular venues for p
rom nights and graduation balls. During the Japanese occupation, it used to hous
e a military police (Kempeitai) headquarters.

But now, even though some of these historical buildings are still standing, thei
r historical background would not be a premium on the value of the land if sold
to a buyer who has other purposes for it aside from rekindling and capitalizing
on its very historical background.
Engr. Jose Ocampo, a licensed appraiser, said that some of these old buildings c
ould not be considered as improvements in the appraising of the properties, and
could actually be a nuisance because the buyer of the properties would still hav
e to demolish the old building if he intends to something else to the property.
While it may be possible that the historical background of these properties coul
d amount to nothing in the appraisal process of their fair market values, Ocampo
said that properties along Rizal Avenue could still fetch a high price, althoug
h at a wide range of prices from P60,000 to P150,000 per square meter, depending
on the peculiar circumstances of a particular parcel of land.
These peculiar circumstances include, among others, the adjacent properties and
their uses, the size of the lot, the size of the streets adjacent to the propert
y, and all other details considered by appraisers in determining the fair market
value of a particular property.

Still high market values


Nonetheless, these high market values of prime real estate could be signs that R
izal Avenue and the efforts to revive it are not too farfetched, especially in t
he areas of culture and history, if not in the area of being the foremost econom
ic center as this area was in the past.
One such testament to the efforts to revive the cultural and historical signific
ance of Rizal Avenue is the Manila Grand Opera Hotel at the corner of Rizal Aven
ue and Doroteo Jose Street, which stands at the original site of the revered Man
ila Grand Opera Hall and retains its name as a reminder to Filipinos not to forg
et their roots, lest they never learn the lessons that history offers.
It was at the Manila Grand Opera House when the first Philippine Assembly was in
augurated in 1907, and, as an opera house became the center of cultural events t
hat helped shape the minds of Filipinos before World War II.
Perhaps, if the chances of reviving the Rizal Avenue area's former position as a
bustling economic center of Manila are dim, the government and the private sect
or could focus on rekindling the cultural heritage that still lives on among the
residents in this area.
Rizal Avenue is still full of history, written in the old structures and heard f
rom the mouths of the old residents. We need only to keep it clean and safe, and
it shall stand as a landmark of the true culture and history of the Philippine
capital and the Filipino people. (David Cagahastian)

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