Philippines’ Iloilo City beats Cebu in Q1 office demand
ILOILO, PHILIPPINES — A mid-sized city in the central Philippines pulled off one of the country’s most significant commercial real estate upsets in early 2026. Iloilo City surpassed Metro Cebu — long the undisputed business capital of the Visayas region — in total occupied office space during the first quarter, according to property consultancy Colliers Philippines.
According to a report from Panay News, the milestone reflects a structural shift in where global outsourcing firms are choosing to establish operations in Southeast Asia, driven by the city’s expanding business parks and a growing base of specialized talent.
Office market shift: Iloilo displaces Cebu
The driver is the caliber of tenants, not just volume. Joey Roi Bondoc, research director at Colliers Philippines, pointed to a dense concentration of high-value outsourcing firms at Iloilo Business Park as the defining factor separating this city from other emerging markets.
“For a city like Iloilo, they attract not just BPO companies but also high-value outsourcing companies,” Bondoc said, noting that supply-driven transactions are accelerating the city’s absorption pace.
The Q1 performance positions Iloilo as a credible, data-backed alternative to Cebu for companies evaluating their next outsourcing footprint in the Philippines.
Real estate demand: investors follow the workforce
Where the workforce concentrates, capital follows. Residential absorption in Iloilo City reached 89 percent for condominium units — above the 87 percent regional average for Visayas and Mindanao — and 96 percent for single-family home developments against a 92 percent regional baseline.
The Philippine central bank reported that 17 percent of household remittances are now directed into real estate investments, providing a demand floor that insulates the market from the volatility common in fast-growing secondary cities.
Harold Geronimo, first vice president for corporate communications at Megaworld Corp., confirmed the momentum.
“Our core businesses have all reported growth during the first quarter of 2026,” Geronimo said.
Western Visayas posted 6.4 percent economic growth in 2025 — the fastest among the Philippines’ 18 regions — giving Iloilo’s property market a macroeconomic foundation that few secondary cities in Asia can match.
For U.S. companies in the outsourcing sector evaluating expansion beyond Metro Manila and Cebu, the city now offers a combination of available Grade-A office stock, a skilled English-speaking workforce, and absorption rates that signal deep, sustained business confidence.
The Q1 data marks the point Iloilo stopped being an emerging option and became a proven outsourcing destination.
