Philippine office space demand exceeds 1Mn sq.m.
MANILA, PHILIPPINES — Total demand for office space in the Philippines surpassed one million square meters (sq.m.) this year, according to real estate services firm Leechiu Property Consultants (LPC).
As of December 13, year-to-date office space take-up reached 1.07 million sq.m., 8% more than the 988,000 sq.m. recorded in 2022.
Metro Manila accounted for 79% or 841,000 sq.m. of demand, led by the Bay Area, Ortigas Center, Makati CBD, Bonifacio Global City, and Quezon City. Provincial areas comprised the remaining 21% or 229,000 sq.m., mostly in Cebu, Clark, Cagayan de Oro, Davao, Laguna, and Pampanga.
Total office vacancy stands at an elevated 18%, but LPC expects this to start declining by 2024 as new supply falls while demand rises. Over 500,000 sqm of live requirements may also spill over into 2024.
LPC’s report revealed that the Information Technology and Business Process Management (IT-BPM) sector continued driving the bulk of space absorption with 450,000 sqm leased this year. However, this was below the 467,000 sqm it took up in 2022.
Philippine Offshore Gaming Operators (POGOs) came next, more than doubling their office space to 185,000 sq.m. despite the Philippine government’s efforts to ban them.
“I think there’s always the volatility when it comes to them, so it’s hard to say whether them taking space now will continue months from now or the next year, but at the moment we’re seeing movement from their end, there’s behavior of them taking space,” said LPC Director for Commercial Leasing Mikko Baranda.
