Philippine Office Space Take-up To Hit New Record

[news]

Philippine Office Space Take-up To Hit New Record
By: Philippines News Agency

MANILA – Office space take-up in Metro Manila this year is likely to breach the 700,000-square meter mark, international property advisory firm Jones Lang Lasalle (JLL) said.

JLL director Phillip Añonuevo said in a briefing on Thursday that 506,574 square meters or 67.9 percent of the total supply in the pipeline for 2015 were leased during the first half of the year.

Office space take-up for the first six months is also close to the level for the entire 2014 at 513,800 square meters.

Añonuevo said supply of office space in Metro Manila this year reached 745,390 square meters.

In its mid-year report, JLL noted that Bonifacio Global City (BGC) had the highest number of vacant office supply for the second semester of the year with a total vacancy of 83,723 square meters.

“Most of buildings in BGC are significantly leased for BPO (business process outsourcing) and corporate offices,” Añonuevo added.

Alabang and Makati follow BGC with 47,010 and 40,715 square meters, respectively, of vacant office supply expected by yearend.

Rising central business district Bay Area in Parañaque City still offers 38,046 square meters of office space, while Quezon City has 24,057 square meters.

Añonuevo said both Bay Area and Quezon City are new destinations for BPO offices.

He noted that average rentals for office space in Quezon City at P700 per square meter per month is not “too far away” from BGC’s Grade A office monthly rate of P850.

Ortigas has the least vacant office space available for lease at 5,271 square meters.

The BPO industry continues to drive the demand in office spaces, Añonuevo said.

He said the BPO industry’s target of 1.3 million employees in 2016 validates the confidence of developers to launch more projects.

“Office market has been performing very well. Leasing activities in the next few years will be upbeat so we see no oversupply [of office space] in 2016,” he added.

With the bullish demand in office spaces, Añonuevo said there is a substantial increase in office space supplies over the years.

From 2009 to 2014, average office space supply reached 400,000 square meters a year. It is projected to double in the 2015-2016 period to an average of 800,000.

“There’s a chance to increase [the supply] in the coming years as developers are expected to announce projects in the next 12 months,” Añonuevo added.

JLL country head David Leechiu said the upbeat office space take-up in the local market is backed by companies’ decision to locate in the Philippines.

“The Philippines is an important hub to companies to cut costs and increase productivity,” Leechiu said.

Philippine Office Space Take-up To Hit New Record
By: Philippines News Agency

MANILA – Office space take-up in Metro Manila this year is likely to breach the 700,000-square meter mark, international property advisory firm Jones Lang Lasalle (JLL) said.

JLL director Phillip Añonuevo said in a briefing on Thursday that 506,574 square meters or 67.9 percent of the total supply in the pipeline for 2015 were leased during the first half of the year.

Office space take-up for the first six months is also close to the level for the entire 2014 at 513,800 square meters.

Añonuevo said supply of office space in Metro Manila this year reached 745,390 square meters.

In its mid-year report, JLL noted that Bonifacio Global City (BGC) had the highest number of vacant office supply for the second semester of the year with a total vacancy of 83,723 square meters.

“Most of buildings in BGC are significantly leased for BPO (business process outsourcing) and corporate offices,” Añonuevo added.

Alabang and Makati follow BGC with 47,010 and 40,715 square meters, respectively, of vacant office supply expected by yearend.

Rising central business district Bay Area in Parañaque City still offers 38,046 square meters of office space, while Quezon City has 24,057 square meters.

Añonuevo said both Bay Area and Quezon City are new destinations for BPO offices.

He noted that average rentals for office space in Quezon City at P700 per square meter per month is not “too far away” from BGC’s Grade A office monthly rate of P850.

Ortigas has the least vacant office space available for lease at 5,271 square meters.

The BPO industry continues to drive the demand in office spaces, Añonuevo said.

He said the BPO industry’s target of 1.3 million employees in 2016 validates the confidence of developers to launch more projects.

“Office market has been performing very well. Leasing activities in the next few years will be upbeat so we see no oversupply [of office space] in 2016,” he added.

With the bullish demand in office spaces, Añonuevo said there is a substantial increase in office space supplies over the years.

From 2009 to 2014, average office space supply reached 400,000 square meters a year. It is projected to double in the 2015-2016 period to an average of 800,000.

“There’s a chance to increase [the supply] in the coming years as developers are expected to announce projects in the next 12 months,” Añonuevo added.

JLL country head David Leechiu said the upbeat office space take-up in the local market is backed by companies’ decision to locate in the Philippines.

“The Philippines is an important hub to companies to cut costs and increase productivity,” Leechiu said.

[Author]

July 7, 2015 at 11:40 AM