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This is Part Two of a series of articles on The Cost of Doing Business in Davao.

Hotel Rates

Many business owners in the city are residing outside of it in the nearby cities and towns. Most of them opt to stay at hotels and other accommodation facilities. Those who have higher accommodation budget can stay at deluxe hotels which have the following rates in Philippine Peso: 6,800 for superior rooms; 8,400 for deluxe rooms; 10,000 for cabana; and 16,800- 53,200 for suites. First class hotels are also best for non-resident business owners. These hotels have the finest facilities and most of them are within the city’s commercial districts. First class hotel rates are as follows; Standard, 3,340- 3, 720; Superior, costs 3,340- 4, 270; deluxe, 5,800; executive suite, 6,100-16,600; and presidential suite, 12,000-20,000. Standard hotel rates are; standard, 600- 2,000; deluxe, 1,099- 2,600; and suite, 1, 898- 4, 000. There are also inns which charge lower compared to others. Inns charge as follows: 405- 600 for standard rooms; 504- 849 for superior room; 849- 2, 200 pesos for deluxe rooms; and 1,200-3, 150 for suites.

Other accommodation centers include apartelles and pension houses. Apartelles charge 500 -1,800 pesos for standard rooms while they charge 700 – 2,160 pesos for double rooms. Pension houses on the other hand charge 500 – 750 pesos for standard rooms, 800 -1,200 for superior rooms and 1,360 – 1,700 for suites.

Power rates

The Davao Light and Power Company is the sole provider of electric power in the city. It charges according to the type of establishment that avails of its service. As of February 2006, residential establishments are charged 5.6460 pesos for every kilowatt hour. Commercial establishments, on the other hand, are charged depending on its size. Power charge for these kinds of establishments ranges from 5.4885- 5.5199 pesos per kilowatt-hour. A 5.0560 pesos per kilowatt-hour is charged on industrial establishments, while establishment which does not fall in any of the mentioned categories are charged 4.9628 pesos per kilowatt-hour.

Commercial Space Rental Rates

Finding an ideal location and space for your business would not be hard in Davao City. However, you should also anticipate bigger rents on spaces especially in areas around the city’s commercial district. Office spaces and small commercial buildings cost roughly from 180.00-332.00 per square meters. Spaces in shopping malls cost higher. It ranges from 500.00-1,500.00 pesos per square meters.

Real Estate Prices

For some businesses, owning a land on which to construct a building for use in conducting their business is a way to go. If you are considering this route, consider the following real estate data.

Residential lands are priced between P 800.00 – P 6,000.00 for every square meter. Commercial ones are roughly from 2, 500.00- 35,000.00 per sq. m.; industrial, 150.00-500.00 per sq. m.; and agricultural lands from 50.00-250.00 per sq. m.

This is according to the Davao Board of Realtors last updated in 2007. These days, it is not uncommon to find land prices sour up to 50% of their value in the span of three years. Soaring of land prices are to be expected especially today that the city’s development is in its fastest.

Transportation Costs

To those who don’t have their own business vehicles, going around the city for business purposes are not that costly. The most common means of transportation is through jeeps since it costs way lesser compared to taxi cabs. Jeep fares start at Php 7.00 up to as much as Php 30.00. Non-airconditioned taxi cabs’ flag down rate is 26.00 while airconditioned ones start metering at 30 pesos.

Car rental is another alternative. There are a lot of car rental services offered around the city. When renting a car, expect a rate of 650.00- 4,100 pesos for no more than 24 hours. Vans can be rented from 800.00-4, 600 pesos while coasters can be rented from 2, 500- 15,000 pesos.

Of course, starting up a business in the city requires initial capital and expenses. For one, there are compliance certificates and other requirements that needed to be accomplished to acquire legal rights on the business venture.

Nonetheless, despite the business expenses, almost any type of business can thrive in the city. All that is needed is wise management and smart handling of investments.

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This article is written by Matt Regis.