KMC Savills is pleased to present to you our latest Office Briefing for 3Q 2016. This report provides current data on rental rates, vacancies, and supply pipeline in Metro Manila's central business districts and submarkets for the quarter.
Here are some of the report's highlights:
- The market was relatively quiet in Metro Manila with fewer supply additions due to several building completions postponed to later quarters. In 3Q/2016, only 18,000 sq m of new office supply was turned over in BGC.
- Occupier demand was still strong though, as the market recorded a net absorption of 24,900 sq m which resulted with the vacancy rate to further drop to 2.7% in 3Q/2016.
- In 4Q/2016, supply additions should return as the market is expected to introduce another 193,300 sq m of Grade A office space. Although we expect office demand to continue to be robust, we foresee a gradual increase in vacancies in the coming quarters with the completion of an unprecedented new supply of 871,900 sq m in the next 12 months.
- Overall, despite tightening vacancies, average rents rose moderately by 3.4% YoY, a slight slowdown from 4.4% YoY in 2Q/2016. However, Quezon City witnessed its first decline in rental rates since 2010 due to the high level of availabilities in the area.
- Looking ahead, the expected new deliveries over the next 12 months should put additional pressure on lease rates in Metro Manila as the vacancies are seen rising.
Click here to read the full report »
For further information about this release, please contact Antton Nordberg or Michael McCullough.