Colliers said the property sector is steadily recovering amid threats of high inflation and potential slow growth.
In a report sent over the weekend, Colliers said the sector’s rebound is supported by the continued recovery of the economy characterized by a steady employment as more business resume operations and expand.
“Colliers Philippines believes the property market is well-positioned to ride this growth trajectory. The office sector is seeing an increase in transactions within and outside Metro Manila, with the capital region registering two consecutive quarters of positive net takeup,” Colliers said.
With the property sector and the economy both in recovery mode, Colliers Philippines believes developers should also expand their footprint in key growth areas outside of Metro Manila.
As of end-June, office transactions hit 325,100 square meters (sq.m.) in Manila, up 62 percent from 200,700 sq.m. last year. Some 146,700 sq.m. of new office space in the second quarter have also been completed.
“From 2023 to 2026, we forecast the annual completion of about 543,300 sq.m. We see annual new supply reverting to pre-POGO (Philippine offshore gaming operators) levels where yearly completion was between 450,000 and 550,000 sq.m. from 2014 to 2016, far from the annual delivery of 983,900 sq.m. from 2017 to 2019, a peak period for POGO take-up,” it said.
Vacancy was at 17.7 percent in the second quarter from 17.3 percent a quarter ago.
Colliers said there was no substantial increase in vacancy as new supply was halved to 146,700 sq.m. for the second quarter from 306,100 sq.m. in the first quarter.
“This was also supported by higher office deals in the second quarter compared to the first quarter. By the end of 2022, we project office vacancy to reach 18.2 percent from 15.7 percent in 2021. We expect net takeup in 2022 to reach 350,000 sq.m.,” it said.
