PHILIPPINE office developers need to upgrade their workspaces and offer lease incentives as more companies return to traditional office setups, according to property consultancy Colliers Philippines.
In its Survey Flash Report released on Wednesday, Colliers said six out of 10 respondents are now working in a traditional office setup, slightly higher than the 54% recorded in the fourth quarter of 2024.
Meanwhile, 40% of respondents follow hybrid work arrangements, while 4% are fully working from home.
“This shows that now is an opportune time for office landlords to aggressively promote their office development pipeline especially in Metro Manila submarkets likely to achieve landlord’s market status in the next 12 to 24 months,” Colliers said in its report.
The consultancy also noted office space consolidation by major occupiers, which creates opportunities for developers with sizable, vacated office space in the Makati central business district (CBD) and Fort Bonifacio to target outsourcing firms and large-scale traditional occupiers.
The Makati CBD (33%) is the top choice among respondents looking to expand in the next 12 to 24 months, followed by Fort Bonifacio in Taguig City (23%).
Other preferred locations include the Bay Area (12%), Quezon City (12%), Alabang (11%), and the Ortigas CBD (10%).
The survey also found that 56% of respondents ranked lower base rents as their most preferred concession when looking for office space to lease, followed by rent-free fit-out periods (17%), fit-out allowance (15%), and no or delayed rent escalation (12%).
In the first half of the year, more than half of Metro Manila-based office transactions were expansions, Colliers said in its Second Quarter Property Market Report.
Outsourcing firms, flexible workspace operators, logistics companies, banks, financial services, and information technology firms took up space in Fort Bonifacio and the Makati and Ortigas CBDs.
The consultancy “encourages occupiers to capitalize on the current market conditions to secure favorable lease terms.”
“Meanwhile, landlords should enhance the look of their spaces and continue offering concessions to stay competitive in a tenant-leaning market.”
Colliers surveyed about 200 respondents from real estate developers, property equity analysts, brokers, and investors from July 30 to 31. — Beatriz Marie D. Cruz
