Citing a recent report by property consultancy firm Knight Frank based on data between 2010 and 2016, the South China Morning Post has reported that by 2020, Manila would record a 19.1 percent growth in prime office rents, surpassing other top performers like Brisbane (16.5 percent), Singapore (15.8 percent), Bangkok (11.4 percent) and Hong Kong (10 percent).
The SCMP report stated that economic growth in the Philippines hovering at up to 7% in the past five years was brought about policies and incentives that attracted foreign investors as well as a steady inflow of remittances from overseas Filipino workers, which in turn, supported the country’s property market – specifically, the office sector in Metro Manila.
“The (Philippine) office property market is very healthy. There’s less than 5 percent vacancy rate in (most of Metro Manila’s) central business districts,” the report quoted Kash Salvador, associate director for investment properties and capital markets at Santos Knight Frank, the Philippine branch of Knight Frank as saying.
Salvador said Manila had the third lowest vacancy rate of the 20 prime office markets in the region, adding that expanding business process outsourcing (BPO) and online gaming industries were the key demand drivers.
The report however said that despite such upbeat forecast, there are deterrents that can turn off potential investors from venturing in Metro Manila, among them thre chronic traffic congestion problem.
A Boston Consulting Group study published in November found that next only to Bangkok and Jakarta, Metro Manila had the third worst traffic in Southeast Asia, with motorists and commuters stuck in traffic for an average of 66 minutes daily,” the SCMP report said.
But, it added, analysts said the government’s infrastructure program like the Mega Manila subway – the country’s first underground railway, can help decongest Metro Manila.
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