Office Vacancies in the Philippines are at 19% as of the Third Quarter of 2023

Despite many companies shifting to a work-from-home arrangement, 81% of office spaces in the Philippines have been leased as of the third quarter of 2023.

Work-from-home setups became the norm during the height of the pandemic due to mobility restrictions set by the government. While many companies have preferred to keep this arrangement, some have shifted to a hybrid setup or have opted to return to the office full-time

While it may seem like the pandemic weakened the demand for office spaces, this isn’t the case. In fact, as of the third quarter of 2023, the Philippines has a total of 18.1 million square meters (sqm) in supply for office spaces. It is a staggering number, but believe it or not, most of this space has been leased.

According to the Q3 2023 Philippine Property Market Briefing from Leechiu Property Consultants, only 3.4 million sqm remains vacant in the whole country. 

Office Vacancies in Metro Manila

Data from Leechiu shows that 14.8 million sqm of the country’s office spaces are located in Metro Manila. The following areas in Metro Manila have the highest supply of office spaces: 

  • Makati City: 3.9 million sqm
  • Ortigas, Pasig, Mandaluyong, and San Juan: 3.2 million sqm
  • Bonifacio Global City (BGC): 2.1 million sqm
  • Bay Area, Pasay, and Parañaque: 1.9 million sqm
  • Quezon City: 1.9 million sqm
  • Alabang and Las Piñas: 0.9 million sqm
  • Taguig City: 0.7 million sqm

Despite ranking third in total office space, BGC has the least office vacancies with 189,000 sqm left. This means that only 9% of its office supply remains vacant. Meanwhile, Makati comes in second with 13% vacancy, while Taguig City ranks third with 17%.

The areas that have the highest percentage of vacant office space are Alabang, Las Piñas, as well as Bay Area, Pasay, and Parañaque. Each area has a 27% vacancy rate. 

Provincial Office Vacancies

While it is expected that the Metro Manila area is dominated by offices—being a business district and all—some companies have taken their business in other areas across the country. In fact, outside of Metro Manila, there is a total of 3.3 million sqm in total office supply. 1.5 million sqm of this is found in Cebu, while the remainder is scattered in different provinces. 

Cebu has 324,000 sqm of total vacancies as of the third quarter of 2023, which means it has a 21% vacancy rate. As for other provinces, 536,000 sqm of their cumulative 1.8 million sqm of office supply remain vacant. 

Key Takeaways for Business Owners

Companies that want to set up their own physical offices will be relieved to know that there are vacancies that they can look into. However, it is important to study the numbers first as certain areas have fewer vacancies compared to others. 

Despite the current number of office vacancies, developers are constantly putting up new spaces to be leased. According to Leechiu, these vacancies are led by newly completed buildings that offer office space. 

This can mean business opportunities—whether in leasing or selling. However, it is important to remember to look into the demand for office space before adding to the vacancies the country already has, given that there needs to be a demand that matches the supply.

Leechiu Director for Commercial Leasing Mikko Barranda notes that in the next two years, office space demand is seen to return to the pre-pandemic level. Before the pandemic, the demand for office spaces was recorded at 1.3 million sqm in 2018.