The Bay Area Office Market located in Pasay, Metro Manila is an emerging district on track to become one of the largest CBDs in the Philippines. The 3,000-hectare land currently houses SM Mall of Asia, one of the major retail shopping areas in the country. It is also home to the Entertainment City, an upcoming 120-hectare casino-resort complex that will feature 6-star hotels, gaming facilities, malls, museums, cultural centers, sports arenas, residential developments and theme parks.
Despite current stock already hitting 300,000 sq m mark, developers continue to pour massive investments into the area, and upcoming stock is now at 380,000 sq m in the next three years. This is due to the strong interest shown by locators in 2015; vacancy rate remains low at 0.2% in the first quarter of 2016. Bay Area's central location featuring proximity to the airport and accessibility to workforce from Cavite, Paranaque, and Pasay makes it attractive to several investors and BPO companies.
Rental rates in the Bay Area continued to rise in the first three months of 2016 but at a more modest pace. In 1Q/2016, average rental rate in the submarket was at Php 676.6 per sq m/month, an increase of 0.3% QoQ and 3.3% YoY.
Vacancy rate in the Bay Area is likely to slightly increase in the next quarters as a result of supply additions. With the demand and supply dynamics in the business district, rental rates are likely to keep growing in the near future although at a slower pace compared to previous years. However, Bay Area is expected to absorb some of the demand in Makati and Ortigas, as vacancy rates remains low in these areas, and there are no more developable lands.
Upcoming Developments in 2016:
|Development:||Scape||iMet||Filinvest Pasay Cyberzone Tower 2|
|Building Grade:||Class A||Class A||Class A|
|GFA:||n/a||23,685 sq m||n/a|
|GLA:||19,075 sq m||18,543 sq m||18,000 sq m|
|Completion Date:||2Q 2016||4Q 2016||3Q 2016|