Leasing an office space is probably one of the milestones for any start up business. Many studies and researches have been linking the productivity of employees as well as the cultivation of a company culture rooting from the existence of traditional office spaces. While it should be one of the top priorities and goals of start up businesses to finally acquire an office, it is important that business owners know where to locate according to their needs and budget in mind.
Many factors contribute to the lease rates of commercial offices in the Philippines, especially in Metro Manila CBDs. In 2019, the average Grade A office lease rates in the four major CBDs range from Php. 691 per sq m per month (Ortigas Center) to Php. 1,104 per sq m per month (Makati CBD).
Location serves as the biggest factor why these lease rates differ. The ease of accessibility through public transportation is one of the most crucial considerations of companies in choosing where to locate their office, hence it becomes a great determinant of lease rates. Additionally, the amenities and establishments nearby to the office space are also factored in.
Many start-up companies are venturing to set up their office in BGC because of availability of flexible office spaces, stable vacancy rate and the good quality of work environment due to its proximity to lifestyle hubs in the area.
However, such companies should also consider the risks in locating in this district such as lack of public transportation options since BGC operates its own bus system and jeepneys are restricted to ply only certain routes.
Another factor that determines the lease rates of offices is its size and availability. Among the four districts, Ortigas Center has the lowest rental rates due to the quality of current stock. Office spaces for lease in this area are the lowest among the four ideal office locations in the metro.
However, we expect a significant acceleration in rents in the district as new supply improves the quality of its overall stock. Ortigas Center is also an ideal district for start ups to consider since the quality of stock is expected to improve in the coming years. It is also competitive when it comes to accessibility as major roads and transportation means (EDSA, MRT and the future Metro Manila Subway Project) transverse it.
Since the emergence of co-working spaces and companies that are more open to remote employees and virtual meetings, Alabang becomes an emerging ideal office location for star up companies and businesses in the metro, especially for those who are targeting to generate labor pool from Southern Manila, such as Laguna and Cavite. Traditional office spaces in the area averages Php. 671.63 per sqm per month. More technologically-savvy and equipped start up companies may opt to lease serviced offices instead.
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