Return to work

Demand for commercial property has increased following a recent Philippine Economic Zone Authority (PEZA) order for a 100 percent return to office for all registered IT-BPO companies starting last April 1.

Latest data from Lamudi revealed double-digit growth in rentals in the first quarter of 2022 compared to the fourth quarter of 2021 for warehouses, offices and buildings after PEZA issued the order.

According to its recent report, commercial business district (CBD)-hosting cities in Metro Manila are brewing with strong commercial property appetite, with upticks in residential rental inquiries in the same period pointing to a return to the metro as employees gear for face-to-face work.

It revealed that in the financial capital of the country which is Makati, the P100,000 to P200,000 price range attracted the largest share of leads for commercial properties to rent in the first quarter, followed by offices, buildings and retail as the most popular commercial sub-categories.

At the same time, demand for residential rentals in Makati grew significantly, with leads increasing by roughly 40 percent during the same period.

Inquiries from property seekers outside of the metro increased during this period, with seekers from Cebu City and Calamba joining Imus and Angeles as part of the top sources of leads for the city, Lamudi reported.

The report noted that in Pasig, the city hosting Ortigas Center, the leads for commercial properties saw a double-digit increase in percentage. In terms of the most popular price segment for commercial properties for rent, the P100,000-P200,000 category likewise generated the most leads in the first quarter of this year.

In the same period, offices overtook warehouses as the most searched sub-category for commercial properties in Pasig. This coincides with an uptick in inquiries for residential rentals, which shot up by 28 percent quarter-on-quarter, it added.

Meanwhile, Lamudi reported that the leads for commercial properties in Quezon City had a double-digit increase in percentage, with commercial rental properties in the same price range garnering the most leads.

The report pointed out that for two years, work-from-home has become the norm amid the pandemic. However, with the number of coronavirus cases declining and lockdown restrictions easing, more businesses are urging workers to return to the workplace.

Lamudi CEO Kenneth Stern however noted that while this offers promising opportunities for real estate players, it also presents challenges, primarily in making commercial spaces appealing to employees who have become used to working from home.

Stern said it is essential to have value-adding amenities that promote work-life balance. These include daycare facilities that allow working mothers to bring their children to the workplace, and fitness centers that make it easy for professionals to embrace an active lifestyle.

The newest frontier

Property management consulting firm Colliers has observed an increasing interest from residential developers and investors in Bulacan’s potential as the next major property investment destination.

Colliers said in a just released report that major infrastructure projects, such as MRT-7 and the New Manila International Airport, both of the San Miguel Group, are likely to define the Bulacan residential landscape, as it expects more developers and investors gravitating toward Bulacan, which is just 20 kilometers north of Metro Manila.

In 2021, it was disclosed that 804 condominium units were sold, which is a record high. A sustained take-up is expected in the next 12 months, partly driven by local end-users and OFWs, with 1,000 units expected to be sold this year.

According to the report, at the end of 2021, Bulacan’s condominium stock reached 2,231 units, 129 percent higher than the 973 units as of the end of 2020. It said that developers are likely to complete new projects on time due to sustained demand from OFWs and investors.

The bulk of the new supply from 2022 to 2025 will likely come from SMDC’s Joy Residences (multiple buildings) and 8990 Holdings’ Urban Deca Homes Marilao (multiple buildings). Other notable projects include Vista Land’s Storeys by Lessandra Building 1 in San Jose Del Monte, Bulacan, it said.

Colliers said the pandemic has raised the need for investors and end-users to be in integrated communities, adding that integrated features will continue to anchor demand for residential projects including unit owners’ access to essential goods and services and proximity to infrastructure projects.

Meanwhile, Megaworld announced that they will be developing Northwin Global City, a P98-billion township in Marilao and Bocaue, Bulacan. The township will host condominiums, office towers, malls, hotels and schools and offers accessibility as it is located near the Manila-Clark Railway project and the Bulacan International Airport.

Colliers associate director for research Joey Roi Bondoc emphasized that Bulacan is definitely on the radar of residential investors and end-users, and that the completion of crucial infrastructure projects should lift the province’s attractiveness moving forward.

He expects greater landbanking activities in the province in the next 12 to 24 months as more national players acquire land in Bulacan, adding that improving connectivity and growing appetite for residential units should raise Bulacan land and property values beyond this year.

The report added that infrastructure projects in the pipeline such as the P740-billion Bulacan international airport, MRT-7, and the North-South Commuter Railway Project should stoke residential demand in the province.

Colliers believes that the sustained demand for economic to affordable residential projects will continue to be driven by OFW remittances in the next 12 months.

It added that the entry of national developers such as SM, Ayala Land and Megaworld through the development of integrated communities is likely to raise condominium prices in the province.

Colliers believes that take-up for residential projects in the province will continue to be buoyed by the pick-up in OFW deployment, the government’s COVID-19 vaccination program, timely delivery of infrastructure projects, and rebound in regional economic growth.

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