Laoag: Northern Dreams for Filipino Homebuyers

In May 2025, SM City Laoag opened its doors as the 88th SM mall in the Philippines, bringing a wave of retail and dining options to a province that had never seen one before. This single event signals something larger: Ilocos Norte is no longer a quiet northern outpost for real estate. The province’s economy grew 8.6 percent in 2024, driven by services, accommodation, and transport. For Filipino homebuyers and investors, the question is whether this momentum translates into a smart long-term bet.

The numbers are hard to ignore. Megaworld Corporation is pouring P15 billion over 10 years into Ilocandia Coastown, an 84-hectare beachfront township adjacent to the historic Fort Ilocandia Resort Hotel. SM Prime followed with a P2.4 billion, three-level mall that is expected to generate 4,000 jobs. These are not speculative moves—they are bets on a region that was the third fastest growing economy in the Philippines in 2023. But a rising tide doesn’t lift every boat equally. The real opportunity lies in understanding which parts of this development story actually matter for someone looking to buy a home or invest in property.

What the New Developments Actually Offer

The two projects sit in different parts of the city but share a common logic: they are betting on tourism and services. Ilocandia Coastown is a long-term play—a decade of development that will gradually introduce upscale residential units, a town center, and a commercial district. SM City Laoag, by contrast, is immediate. It opened with 90 percent of its leasable space already awarded, meaning the retail ecosystem is already in place. The mall includes homegrown brands like Amian Coffee, Lanie’s Empanada, and Sentro Café, which signals an effort to blend national retail with local character.

What Changes the Answer for Different Buyers

The value of buying property in Laoag right now depends heavily on what you are looking for. A vacation home buyer and a long-term investor face very different calculations.

For someone seeking a second home or retirement property, the appeal is clear: a beachfront township with heritage-inspired architecture, proximity to an international airport, and a UNESCO World Heritage site nearby. The 1.4-kilometer beach line with sand dunes at Ilocandia Coastown is a genuine differentiator—few Philippine townships offer that kind of natural setting within a planned development. The catch is timeline. Megaworld’s project is a 10-year build-out. Early buyers will live through construction noise, incomplete amenities, and uncertain resale values until the township reaches critical mass.

For an investor focused on rental income, the calculus shifts. SM City Laoag’s 4,000 jobs will bring workers and foot traffic, but the city’s existing hotel supply, including the aging Fort Ilocandia Resort Hotel (last renovated in 1995), suggests room for growth. The mall’s opening in May 2025 creates immediate demand for short-term rentals near Airport Road, where the mall is located. However, Laoag City had only 1 percent of establishments shuttered during COVID-19, with 10 percent new business creation—a sign of resilience but also of a small base. Rental yields in a city of this size are unlikely to match Metro Manila or Cebu in the short term.

The political landscape also matters. In the May 2025 midterm elections, Matthew Marcos Manotoc was reelected governor, while Bryan Alcid defeated incumbent Mayor Michael Marcos Keon in Laoag City. A change in local leadership can affect permitting, tax incentives, and infrastructure priorities. Buyers should monitor whether the new administration maintains the same pro-development stance as its predecessor.

Complications, Exceptions & Fine Print

The Fort Ilocandia Factor

Ilocandia Coastown is adjacent to Fort Ilocandia Resort Hotel, a property built by former first lady Imelda Marcos that is more than 40 years old and was last renovated in 1995. The hotel was privatized after the 1986 EDSA People Power Revolution. Its current condition and management will directly affect the township’s appeal—guests and residents of the township will likely use its facilities, and a dated anchor property can drag down the entire area’s perception. Megaworld has not announced any plans to renovate or integrate the hotel, which is a risk for early buyers.

Digital Cities 2025: A Double-Edged Sword

Laoag City is part of the Department of Information and Communications’ Digital Cities 2025 program, which targets IT-BPM investments and business district growth. This is positive for job creation and demand for commercial space. But it also means the city is competing with other Digital Cities across the Philippines for the same pool of outsourcing companies. If Laoag fails to attract enough tenants, the anticipated office and residential demand may not materialize as quickly as projected.

SM’s Expansion Pace

SM Prime is also planning a new hotel in Laoag, announced seven months after Megaworld’s township reveal. This suggests SM sees enough demand to support both a mall and a hotel, but it also means increased competition for hospitality and retail spending. For a homebuyer, more commercial development raises property values in the short term but can lead to oversupply if growth doesn’t keep pace.

What To Do With This

If You Want a Vacation Home

Focus on Ilocandia Coastown’s residential offerings, but only if you are comfortable with a long horizon. The heritage-inspired design and beachfront location are unique, and the township’s town center and commercial district will add value over time. Visit the site in person—check the actual distance to the beach, the state of the sand dunes, and the proximity to Fort Ilocandia. Ask the developer for a phased timeline and guarantees on common area completion before committing.

If You Are Investing for Rental Income

Target properties near SM City Laoag along Airport Road. The mall’s 4,000 jobs and 51,000 square meters of leasable space create immediate demand for housing, especially for retail workers and business travelers. Short-term rentals near the airport also have potential, given the mall’s role as a regional draw. But keep expectations modest—Laoag is not a tourist hotspot like Boracay or Palawan. Rental yields will likely be in the single digits until the township and hotel developments mature.

If You Are Buying for Long-Term Appreciation

Ilocos Norte’s 8.6 percent economic growth in 2024 and its status as the third fastest growing region in 2023 provide a strong macro backdrop. The combination of a Megaworld township, an SM mall, and a Digital Cities designation creates a rare convergence of catalysts. The safest play is to buy land or a pre-selling unit in Ilocandia Coastown’s first phase, where entry prices are lowest and the upside is tied to the entire 10-year development. Just be prepared to hold for at least 5–7 years before seeing meaningful appreciation.

Frequently Asked Questions

Making the Call

Laoag is not a sure thing, but it is one of the few places in the Philippines where two major developers are placing simultaneous, large-scale bets. The convergence of a Megaworld township, an SM mall, and a Digital Cities designation creates a rare window. The key is matching your timeline to the project’s pace. If you need returns in 3–5 years, look near the mall. If you can wait a decade, the township offers the bigger upside. Either way, visit the site, talk to local brokers, and watch the new mayor’s first moves on business permits and infrastructure. The northern dreams are real—but they run on Ilocano time.

If this was useful, you might also want to read our analysis of Manila’s overlooked investment areas.

Sources

Coastal vs. Inland: The Ultimate Davao Property Location Showdown — A framework for comparing beachfront and inland property investments, useful for understanding Laoag’s coastal vs. city-center dynamics.

Affordable Housing in Central Luzon: Dreams or Reality? — Examines how provincial economic growth translates into housing affordability, a parallel to the Ilocos Norte story.

SM Prime plans new hotel in Laoag, Ilocos Norte. Rappler, 2025.

Megaworld to build P15-B township in Laoag City. Rappler, 2024.