Searching for a warehouse for lease is a major and crucial business decision as it is a sign of growth and expansion. Unlike renting commercial real estate, warehouse leasing can be unfamiliar territory for many. Although similar to the basic terms on commercial leases, there are more considerations to take into account when it comes to warehouse space.
Diving head-on into something new is not a risk one should take with business and finances. Knowing the logistics and warehousing climate in the Philippines will help you make informed decisions.
Overview on the Logistics and Warehousing Sector in the Philippines
According to the latest report by KMC Savills, the logistics and warehousing sector accounts for nearly 4% of the country’s gross domestic product (GDP). Citing data from the Philippines Statistics Authority, a total of ₱37.5 billion was invested last year in projects focused on transportation and storage. The COVID-19 pandemic has disrupted the Philippines’ economy, yet still, the sector continues to hold its ground and show improvements in the nation’s overall Logistics Performance Index (LPI).
The steady rise of e-commerce, with its potential further pushed by the pandemic, is one of the main reasons for logistics and warehousing’s presently growing demands. A steady logistics and warehousing sector is expected in the coming years.
Warehouse Leasing Rates and Locations
Over half of the country’s leasable warehouses are situated in Metro Manila and mostly occupied. Based on KMC Savills Research, the latest warehouse lease rates in the metro (per sq m/month) are as follows: Makati - PHP 678.00; Taguig - PHP 425.00; Quezon City - PHP 400.00; Valenzuela - PHP 400.00; Parañaque - PHP 238.00; Pasig - PHP 231.00; Marikina - PHP 220.00.
Initial Stage of Planning
Business’ needs will determine the requirements and provisions sought in a warehouse space. Diverse businesses mean differing needs. Proper assessment of what the company requires will narrow down the list of potential warehouses to search for. During this initial stage, it’s also critical to crunch the numbers and align the cost of warehouse leasing with the company’s annual budget. This is done to avoid unnecessary financial losses.
Scaling up entails bigger responsibilities and pivotal decisions - two determining factors to see where the company is headed. If done right, success is to be expected, otherwise, one wrong move can come at a great cost.
That’s why it is more important to seek out expert help and advice in the process. Industrial and logistics professionals offer their expertise by providing quality and tailored end-to-end solutions for specific warehouse leasing demands.
With warehouses, cubic footage takes top priority over square footage, making sure that there’s adequate space for both storage and movement within the facility. Additional factors to consider are warehouse-specific configurations such as floor load, ceiling heights, electrical wiring, and security among other things.
The search for the right warehouse for lease need not be intimidating. Finding the right professionals to get on board will make the leasing process easier and problem-free.
Want to get the latest in the Philippines' Industrial and Logistics Sector? Get in touch with Robert de Bustos at (+63) 917-326-3351. Need assistance in finding the perfect warehouse for your business? Contact us by calling (+63) 2-8403-5519 or send an email to [email protected].