Daily Tribune‘A lot of redevelopment and mall expansions will be happening in 2025, which will define the shopping mall developments in the future as we see a lot of opportunity for this market. For the hospitality market, we are expecting it to grow together with the retail market due to the increase in tourist arrivals in the country’
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Janlo Delos Reyes, head of Research and Consulting of JLL Philippines, says Taguig City topped Metro Manila cities with the highest office leasing transactions at 151,030 sqm, followed by Makati (107,602 sqm), and Quezon City (79,353 sqm). ‘We project leasing volumes to remain stable throughout 2025, reaching around 600 to 700,000 sqm, supported by the BPO and traditional office demand. We expect soft leasing to persist as hybrid work arrangements continue to shape the office landscape. Nevertheless, we still expect solid interest coming from BPO and corporate occupiers to enter the market,’ Delos Reyes said.
Photograph by Raffy Ayeng for the daily tribune
The country’s office, hospitality and retail markets are seen to have a silver lining and are expanding this year, even though the entire real estate industry in 2024 incurred a mixed bag in performance, global real estate services firm JLL Philippines said on Tuesday.
During the JLLQ4 2024 Market Overview, Janlo Delos Reyes, the head of Research and Consulting of JLL Philippines, reported that Metro Manila gross leasing volumes grew 27.3 percent year on year, with 583,728 square meters of leased properties versus 458,470 sqm in 2023.
Taguig City topped Metro Manila cities with the highest office leasing transactions at 151,030 sqm, followed by Makati (107,602 sqm), and Quezon City (79,353 sqm).
Making up the office leasing volumes were corporate/traditional occupiers at 44.6 percent; business process outsourcing (BPO) occupiers (40.7 percent) and internet gaming licensees at 14.7 percent.
“We project leasing volumes to remain stable throughout 2025, reaching around 600 to 700,000 sqm, supported by the BPO and traditional office demand. We expect soft leasing to persist as hybrid work arrangements continue to shape the office landscape. Nevertheless, we still expect solid interest coming from BPO and corporate occupiers to enter the market,” Delos Reyes said.
For the retail market, he said the sustained growth in store openings was tallied in Metro Manila prime mall store openings and closures.
He said 40,820 sqm of spaces were opened in the fourth quarter of 2024, a slight decline from the opened store spaces of 59,988 sqm last 2023.
Continuous expansion of new entrants posted Metro Manila prime mall store openings and closures, with local entrants dominating at 63 percent, and foreign entrants at 37 percent.
For the hospitality sector, the occupancy rate in Q4-2024 was 83.2 percent or 44,600 rooms occupied by hotel guests, lower compared to the same period last 2023 of 86.4 percent. or 43,300 rooms.
“For the hospitality market, full-year tourist arrivals stood at 5.9 million but fell short of the 7.7 million targets of the government. But one thing worth noting is that despite this, we are still seeing a growth in tourist arrivals of around 9.2 percent year-on-year. We anticipate tourist arrivals to continue recovery in 2025, which will benefit the hospitality sector as a whole,” Delos Reyes reported.
For the outlook across Philippine real estate segments, Delos Reyes said the office market is seen to have a high volume of vacancy supply to continue to pressure the market.
“The retail segment, on the other hand, shopping centers will have to be more experiential, as a lot of redevelopment and mall expansions will be happening in 2025, which will define the shopping mall developments in the future as we see a lot of opportunity for this market. For the hospitality market, we are expecting it to grow together with the retail market due to the increase in tourist arrivals in the country,” he said.
