PH office rent market hottest in Asia
Manila Standard Today
June 8, 2013
DEMAND for offices in Metro Manila’s Commercial Business Districts (CBD’s) hit an all-time high making the Philippine office sector among the most dynamic in Asia.
In a press briefing, prominent commercial real estate services firm, CB Richard Ellis (CBRE) Philippines disclosed that the country’s office market is growing at record levels with occupancy rates hitting 97 percent across Central Business Districts (CBDs) in the first quarter of 2013 “as it shows no signs of slowing down”.
CBRE vice chairman and global corporate services chief Joey Radovan said that “Makati City remains the country’s top CBD as it offers the highest quality Grade A and premium office buildings available in the market”.
Makati largely gained from the expansion of multinational corporations, with the CBD’s vacancy rating down to 5.07 percent in the first quarter from 5.45 percent recorded in the previous quarter.
Radovan said vacancy rates in Bonifacio Global City (BGC), Ortigas, Alabang, and Quezon City fell below 5 percent in the first quarter, benefiting from the tightening of supply and increasing rates in Makati CBD.
Metro Manila is among the areas where rental growth is accelerating, alongside Bangkok, Taipei, Tokyo, according to industry data. Occupancy rate in Metro Manila has consistently been above 90% since 2011.
CBRE estimates office space take up for 2013 in Metro Manila is at 450,000 sqm and nationwide at 600,000 sqm.
CBRE CEO Rick Santos in the same briefing attributed high investor confidence that placed the Philippines office rental vacancy levels to hover at an all-time low of 3.21 percent in Metro Manila.
“Amid continuing credit upgrades, cost-effective rental rates, the influx of expanding multinationals and manufacturers, and expatriates moving from renting to buying properties, we see a very encouraging outlook for the Philippine property sector, Santos said.
Radovan further explained that the combination of the effect of anti-speculation taxes, tighter rules, and sky-high property costs in saturated markets such as China, Hong Kong and Singapore, more property investments are expected to boost Philippine developers”.
Emerging business districts in Metro Manila, such as Bonifacio Global City in Taguig, benefitted from the tightening of supply and increasing rates in Makati CBD.
The growth of BPO full-time employees (FTE) was highest in BGC, Muntinlupa and Quezon City. FTE growth in the Taguig, particularly in the BGC, grew by 13% in 2012. It surpassed Muntinlupa in 2010 and Mandaluyong in 2011.
When it comes to total FTEs, Makati still leads all cities at 86,757. Quezon City is close behind with 51,518 FTEs, a number largely boosted by BPO locators in Eastwood, UP-Ayala Technohub, Eton Centris and Eton Cyberpod Corinthian.