Cost to fit out office spaces in Manila averages around $1,006 per square meter (sq.m.), according to property consultant Jones Lang LaSalle Inc. (JLL).
The Philippines’ average cost is lower than the $1,162 per sq.m. in Taiwan; $1,437 per sq.m. in Hong Kong; $1,306 in Singapore and ; $1,059 in Kuala Lumpur.
It, however, is more expensive than the $874 per sq.m. in Hanoi; $854 in Ho Chi Minh; $864 in Jakarta and $804 in Bangkok, as JLL reported in its Asia Pacific Fit-Out Cost Guide 2023/2024.
In its report, JLL said the cost to fit-out workplaces in Asia-Pacific continues to rise, mirroring ongoing inflationary pressures, higher commodity prices and increased construction costs.
JLL said the average cost to fit-out workplaces across the Asia-Pacific region increased 0.5 percent year-on-year with the average fit-out cost per sq.m. rising to $1,161 from $1,159.
“Inflation in Asia-Pacific markets is returning to normal levels as widely projected, but certain supply chain challenges remain for mechanical, engineering and plumbing, information technology and audio-visual items,” said Martin Hinge, JLL Asia-Pacific executive managing director for project development services.
“Going forward, we foresee factors like commodity process, energy costs, and wage increases will continue to impact pricing for some fit-outs in Asia- Pacific,” Hinge added.
JLL said sustainability remains top- of- mind among tenants, with leasing office space in sustainable buildings becoming non-negotiable for occupiers committed to environmental, social and corporate governance principles.
“Among other factors, sustainable fit-outs are gaining prominence as an initiative to decarbonize workplaces. In a survey of 240 CRE (commercial real estate) leaders across Asia Pacific, one-in-two cite sustainable fit-outs as a priority to be actioned within the next three years,” it said.
Responding to inflationary pressures that projects are facing, one-third of JLL survey respondents in Asia- Pacific reported that pursuing a sustainable design is dependent on the overall project cost.
“(About) 56 percent of them, the bulk of which was in Australia and Southeast Asian markets, also confirmed that reduced capex on initiatives was being considered as a means to work within budgets,” it said.
“In the Philippines, construction costs are increasing, albeit much lower than rate of inflation. At the end of the day, costs vary on a case-to-case basis, and the fit-out guide serves as a springboard to discuss the needs per project,” meanwhile said Calum Swinnerton, JLL Philippines head of project development services.
