In another sign things have returned to normal, office demand in Metro Manila doubled in the second quarter as more firms require additional capacity to accommodate in-person work. According to Leechiu Property Consultants, office space transactions during the first six months of 2022 are nearing what was seen in the entirety of 2021.
“The office segment remains resilient. We have a healthy pipeline of live transactions of 451,000 square meters,” Leechiu Property Consultants Director for Commercial Leasing, Mikail C. Barranda, state during a digital event. ““As the economy opens up, we are confident that transactions especially in the office sector will pick up, driven by firms that will use outsourcing in tough times.”
Speaking of the business process outsourcing (BPO) industry, it was a key driver of the office demand increase. Firms in this space made up 42 percent of all transactions to start the year. Meanwhile, the Philippines accounts for 10-15 percent of the entire sector globally. With more companies considering BPO options, there is further room for growth here.
“All the leasing activities in the past three months, from many new captives and companies doing business here for the first time, tell us that outsourcing to the Philippines continues to be a reliable solution for companies in the West fighting an impending global recession,” Barranda stated.
The news of office demand doubling was not much of a surprise to those following the sector as Colliers Philippines predicted a turnaround at the start of the year. However, the positive impact of this isn’t limited to the workplace.
Residential real estate is beginning to rebound as people return to work. After a pandemic-induced decline, Metro Manila is seeing an increase in housing demand with more people wanting to live closer to the office once again.
“The residential segment is finally seeing a gradual market correction after both the demand and new launches were postponed at the height of the pandemic,” Claro Cordero Jr., Director and Head of Research, Consulting and Advisory Services Cushman and Wakefield, stated. “The major CBDs in Metro Manila are attracting increased demand for residential and commercial properties following the return-to-office of many companies. Makati City, in particular, has attracted a quarter-on-quarter increase in residential rental leads by around 40 percent in the first quarter of 2022.”
Keep Reading: Residential real estate rebounding as more people return to work
