According to Angela Sumalinog, the Head of Research at CBRE Philippines, developers are adapting their portfolios to address the high vacancy rates in the Philippine real estate market. This move comes as the traditional office leasing market experiences a five-year low, with only 111,350 square meters worth of leases signed in Q2, resulting in a 18.5% vacancy rate. This improvement is attributed to slower leasing decisions and increased demand for flexible workspaces.
The flexible office segment is experiencing significant growth, with over 3,400 new seats coming to the market via KMC Solutions, IWG Group, work.able, The Executive Centre, and Quad. The majority of this growth, 84%, is happening within Metro Manila, while the remaining 16% occurs in growth corridors like Cebu, Pampanga, Davao, Iloilo, Bacolod, and Cagayan de Oro. CBRE expects more consolidation from foreign workspace providers such as Table Space entering the Philippine market, positioning the country as a strategic location for global centers looking to diversify beyond the Indian market.
In the Philippine real estate market, developers are adjusting their portfolios to tackle the high vacancy rates. Developers are doing this as the traditional office leasing market experiences a record low in Q2, with only 111,350 square meters worth of leases signed, resulting in a 18.5% vacancy rate. This decrease is due to slower leasing decisions and increased demand for elastic workspaces.
The elastic office sector is growing rapidly, with over 3,400 new seats hitting the scene through KMC Solutions, IWG Group, work.able, The Executive Centre, and Quad. Almost 84% of this progress is occurring within Metro Manila, while the remaining 16% takes place in growth corridors such as Cebu, Pampanga, Davao, Iloilo, Bacolod, and Cagayan de Oro.
CBRE predictions indicate that more workspace providers, such as Table Space, will enter the Philippine market, positioning the country as a strategic location for worldwide centers seeking to diversify beyond the Indian market.
