Growth in the real estate sector is shifting to areas outside of Metro Manila as the capital district is currently experiencing a slowdown, property consultant Colliers said.
Joey Roi Bondoc, Colliers’ head of research in the Philippines, said developers such as Ayala Land, Inc., Rockwell Land Corp. and Megaworld Corp. are focusing more on areas such as Batangas, Palawan, Bohol, Davao, and “some islands in the Visayas.”
Their game plan is “to put up leisure-oriented wellness-centric developments,” banking on the rising number of foreign tourists in the country.
Bondoc said the government’s aim to attract 7 million international tourists by 2028 encourages this shift.
This has led to the rise of emerging locations around the country for real-estate opportunities outside of what big realty players dabble in, Bondo said.
In particular, Bondoc noted the emergence of New Clark City in Capas, Tarlac, as the government invests resources to develop the area with infrastructure like the North-South Commuter Railway.
Bondoc also cited Visayas. “When we go to Visayas, I would say outside of Cebu — the biggest office location — Iloilo and Bacolod are locations to watch. An interesting location in Mindanao is Cagayan de Oro. So you have foreign hospitality brands aggressively looking at opening new facilities in Cagayan de Oro,” he said.
Bondoc said developers have been working on incorporating unique features in their developments to set their offerings — green spaces, retail offices, and support facilities — apart from the usual demand from end-users and investors.
“When you look at Angeles, there’s a project by Rockwell, the Rockwell Nepo. This township will feature the first power plant mall outside of Metro Manila,” he said, adding, “Developers have really become more active in attracting end-users and investors. And again, we believe that this will likely be the norm going forward.”
Bondoc said development projects beyond Metro Manila will pick up the slack in the overall property market.
Bondoc said he has observed tempered demand in the office segment in Metro Manila due to the US factor—the end-2024 vacancy rate was 19.8 percent and is expected to rise further to 22 percent this year.
Meanwhile, net take-up declined by 450,000 square meters last year, though it is seen picking up to 150,000 square meters this year.
The residential segment, meanwhile, experienced a 59 percent drop in pre-selling launches last year at 11,000 units, compared with 25,000 units the prior year.
Pre-selling take-up dropped 61 percent to 9,000 units from 23,000 units the prior year.
Bondoc said that as of the end of 2024,
about 26,300 condominium units were ready for occupancy in the Metro Manila market.
He said growth in these segments outside of Metro Manila hinges on the government’s infrastructure push and developers need to adapt to changing market trends and consumer preferences.
“A major driver of the property sector is infrastructure. And we believe that infrastructure will continue to be built, developed and implemented by whoever sits in Malacanang,” Bondoc said.
The Philippine property sector is partly isolated from all these geopolitical noises we’re seeing here and right now,” he said.
