The Philippine office market is expected to maintain sequential growth next year, driven by increasing demand from information technology-business process management (IT-BPM) tenants and renewed acquisitions from traditional sectors, according to property consultancy Leechiu Property Consultants (LPC).
“While challenges remain, the Philippine office sector has time and again proven its resilience, and all indications show that the momentum will continue in the coming year,” LPC director of commercial leasing Mikko Barranda said in a statement on Monday.
Year-on-year, office workload rose 10% to 1.22 million square meters (sq m), the consultancy said in its fourth-quarter property market report.
Of the total, the IT-BPM sector accounted for 32% (549,000 sq m), while other tenants – including traditional corporates, government agencies, and Philippine inland gaming operators – took up 68% (671,000 sq m) of space.
“This performance underlines the enduring relevance of the sector despite the current global headwinds, geopolitical uncertainty and economic instability,” Mr Baranda said.
Among sub-markets, Bonifacio Global City (BGC) leads with 218,000 square meters, a 73% increase in transactions, followed by Quezon City (169,000 square meters) and Ortigas-Mandaluyong area (155,000 square meters). Among the provinces, Cebu topped with 150,000 square metres, or 55% of provincial take-up.
Net acquisitions increased 13% to 476,000 sq m. In 2025, above 422,000 square meters. A year ago. LPC noted that steady demand and low-scale exits helped stabilize net absorption, despite increased voids at the start of the year.
Vacancy fell 59% to 205,000 square metres. in the fourth quarter, primarily due to downsizing and ongoing consolidation among IT-BPM firms.
LPC's projects amount to 2.3 million sq.m. Upcoming office supply across the country with 1.9 million square meters over the next five years. Expected to come online in Metro Manila by 2026.
Mr Baranda said demand in the office market is likely to remain intact as companies continue to prioritize onsite work, while developers remain flexible to meet the growing needs of tenants.
“Occupiers are adopting flexible strategies, consolidation, flight-to-value opportunities and long-term growth planning, while landlords are responding with better terms, more efficient spaces and investment in sustainability and smart-building features,” LPC said.
Over the next three years, low interest rates and a tight supply pipeline are expected to support transaction activity.
“However, the country's success in attracting long-term investment flows will depend on its ability to enhance competitiveness through manufacturing revival, office space reimagining and workforce upskilling,” the LPC said, highlighting the need for key sectors such as real estate, tourism, manufacturing and retail to address pricing gaps, infrastructure bottlenecks and global competition. , Beatriz Marie D. Cruz
