Land Banking in the Philippines: An Underrated Investment Strategy

Decades before Metro Manila’s suburbs boomed, property magnate Manuel “Manny” Villar was quietly snapping up thousands of hectares of cheap farmland. As a Chinese proverb goes, “The best time to plant a tree was twenty years ago. The second best time is now.” In other words, Villar—and other shrewd investors—treated land as a long-term bet. They bought peripheral estates long before roads, rails or malls arrived, then simply held onto them. Today, those once-idle tracts are paying off: Villar’s crown-jewel development, Villar City (3,500 hectares on Metro Manila’s fringes), is bustling with pre-sold villages and commercial lots.

Land banking is essentially this strategy of buying undeveloped land and waiting for a growth catalyst. As one property guide explains, it “refers to the practice of purchasing parcels of land with the intent to hold onto them until they appreciate in value,” relying on future infrastructure, zoning changes or urban spillover to drive the price higher.

What is Land Banking?

Land banking isn’t about quick flips. It’s “buy low, sell high” applied to raw earth. Investors seek out rural or suburban lots that look undesirable today but may become valuable later. Key to the game is foresight and patience. For example, analysts note that a good land-bank purchase is “in a location that will likely appreciate due to upcoming infrastructural developments.” Think plots near a future highway, railway extension or new airport. Unlike buildings, vacant land carries almost no maintenance costs and comes with total flexibility. You can build, lease or resell only when the time is right. As a Philippine real estate guide puts it, well-chosen plots can “appreciate significantly” over time – an attractive proposition for a savvy tycoon.

However, land banking is far from risk-free. It ties up large sums for years, and illiquid land can stall if approvals lag or markets slump. Titles and zoning must be vetted thoroughly. But the potential upside is enormous: early backers of today’s growth corridors often reap outsized gains when cities expand outward.

Why the Wealthy Bet on Raw Land

For high-net-worth investors, land banking offers unique advantages. First, land is finite – it can’t be printed or deteriorated like other assets – so a growing population will always need it. Second, by parking funds in “dirt cheap” ground, investors can kick back and let time do much of the work. One industry executive notes that after the pandemic, his company simply “took advantage of our existing land bank for developments,” leveraging already-owned plots instead of buying new ones. In other words, holding a huge land reserve gave them the luxury to weather downturns and roll out projects only when markets recovered.

Land banking also diversifies a portfolio. If stock markets wobble or banks tighten lending, a vault of vacant lots can be a safe haven. And when big government programs – like the Duterte/Marcos “Build, Build, Build” highways and railways – are rolled out, the owners of nearby land suddenly find themselves sitting on a gold mine.

Case Study: Villar Land’s “Tree-Planting” Strategy

Villar Land Holding Corp. (Vista Land’s parent) illustrates land banking in action. As BusinessWorld reports, Villar Land has spent decades making “strategic acquisitions,” amassing “a formidable landbank” whose centerpiece is a 3,500-hectare estate along southern Metro Manila and Cavite. When these tracts were acquired, they were peripheral farmland. Today, major infrastructure – like the Laguna Expressway, C-5 South Link and planned LRT extensions – is turning Villar City into a commuter hub. These connectivity gains have “fueled brisk pre-selling of residential communities” and rising demand for commercial lots.

By locking in prices decades ago, Villar Land now “enjoys an edge in a growth corridor” marked by rising land values and scarce developable space. The value shift is striking. As of 2025, commercial lots in Villar City’s new Innovation District go for about 345,000 pesos per sqm – below nearby Filinvest City and Ayala’s suburbs. Essentially, early land banking let Villar sell today at a discount to competitors while still locking in multibillion-peso values. Even Vista Land’s own CEO, Manuel P. Villar Jr., has noted that using their deep “land bank” helped sustain growth: during COVID he proudly said they “took advantage of our existing land bank for developments,” highlighting how a big inventory can be deployed as needed.

Growth Corridors: Pampanga and Tarlac as Land Banking Frontiers

If there’s one region in the Philippines where land values are quietly gearing up for explosive growth, it’s Central Luzon — and at the heart of it lie Pampanga and Tarlac. These provinces aren’t just beneficiaries of growth—they’re being positioned as the country’s next economic command center. The confluence of infrastructure, logistics, government-backed development, and private sector investment makes them a land banker’s dream.

At the northern tip of Central Luzon, New Clark City is a flagship development envisioned as the Philippines’ first climate-resilient, green metropolis. However, most of the land inside NCC is leasehold, governed by the BCDA. That makes surrounding areas like Capas, Bamban, and parts of Concepcion far more attractive for long-term investors looking for freehold ownership. In these zones, farm parcels and residential plots remain available at relatively low cost, despite proximity to infrastructure like the North–South Commuter Railway and the Subic–Clark–Tarlac Expressway.

South of this, Pampanga’s freehold regions — especially Angeles City, Porac, Magalang, Mexico, and Floridablanca — present significant opportunities. Unlike Clark Freeport Zone, which operates under leasehold restrictions, these municipalities allow titled land purchases. Many areas remain underutilized or agricultural but are already being eyed for transformation into mixed-use districts, logistics hubs, and suburban housing zones. For example, Mexico is experiencing renewed interest due to its proximity to both the NLEX and the town of San Fernando. Porac, once mainly agricultural, is seeing developers convert farmland into residential subdivisions.

Meanwhile, Bataan is quietly emerging as a compelling land banking destination, especially with upcoming infrastructure like the Bataan–Cavite Interlink Bridge (set to be one of Southeast Asia’s longest sea crossings). Towns such as Morong, Limay, Orani, and Mariveles — the site of a growing Freeport Area — are seeing renewed attention. The province's coastal access, industrial potential, and affordable land prices position it as an early-stage opportunity akin to what Pampanga was a decade ago.

Investors who secure freehold lots in these fringe areas aren’t just speculating—they’re positioning themselves at the edge of Luzon’s most ambitious urban transformation.

Conclusion: Don’t Miss the Dirt

Land banking may not offer immediate cash flow, but in the long game, it’s where fortunes are quietly made. As Central Luzon evolves into the country’s next urban powerhouse, opportunities lie not just in headline cities but in the quiet towns next door — places like Capas, Angeles, Porac, and Magalang.

For those who plant their investment seeds now, the next decade could deliver a bountiful harvest.