Makati CBD still most preferred office location

MANILA, Philippines — The Makati central business district (CBD) remains the most preferred location for office tenants looking to relocate or expand their operations, results of a survey showed.

In its Manila Q3 2024 Survey Flash Report, property research and advisory firm Colliers Philippines said Makati CBD is the choice location of 37 percent of respondents looking to relocate or expand their operations.

“The business hub continues to attract multinational corporations as well as large outsourcing firms,” Colliers said.

“In our view, Makati CBD is up for redevelopment and landlords should capture demand from firms planning to locate and expand in the country’s primary financial district,” it added.

Bonifacio Global City (BGC) was the next most popular choice for relocation or expansion as it is preferred by 25 percent of respondents.

Other preferred sites include Bay Area (14 percent), Alabang (14 percent) and Ortigas CBD (10 percent).

Data from Colliers showed that about 34 percent of office transactions in the nine months to September were driven by relocations, with most firms implementing flight-to-quality/value strategies.

Colliers said it continues to see demand coming from various segments. In the first nine months of 2024, it recorded leases from government agencies, banking and financial service providers and IT companies locating in Makati CBD, Bay Area and BGC.

“We project a continued takeup of office space in the above-mentioned locations given the availability of new and high-quality office space being offered at discounts ranging from three and 30 percent compared to pre-pandemic rates,” Colliers said.

“The Bay Area, for instance, has been a preferred site by government agencies given the availability of newer and more expansive office space with spread between published and transacted rates ranging between seven and 19 percent as of end-September 2024,” it added.

The professional services firm said companies looking to minimize capital expenditures should also consider available fitted space.

Colliers data showed there are about 439,000 square meters of available fitted space in Metro Manila, with BGC and the Bay Area accounting for 40 percent of the available supply.

Moreover, results of the survey showed that access to transportation terminals is vital for tenants’ expansion and relocation plans, with nearly 70 percent saying it is their topmost consideration when looking for a new site.

“Colliers believes that ease of commuting will play an important role in luring employees back to traditional office setup. In our view, landlords should highlight their office towers’ proximity to terminals and residential communities,” the firm said.