Construction activity in the Philippines showed a shift toward higher-value projects in February, as total building costs surged even while the number of approved constructions declined, according to the Philippine Statistics Authority.

Data showed construction value rose 28.1 percent year-on-year to P56.34 billion, driven largely by strong growth in non-residential developments. This came despite a 2.2 percent drop in the number of approved building permits, which fell to 14,996 from 15,341 a year earlier.

Non-residential buildings accounted for the bulk of spending, contributing P36.41 billion or nearly two-thirds of the total value. This segment expanded by 67 percent year-on-year, with institutional projects making up the largest share.

In contrast, residential construction value declined by 12 percent to P16.42 billion, even as it continued to dominate in terms of volume. Residential buildings made up 61.8 percent of total projects, led by single detached houses, which comprised more than 80 percent of the category.

The data highlights a divergence in the sector, where fewer residential builds are being offset by larger, more capital-intensive non-residential projects.

Floor area trends reflected a mixed picture. Total construction floor area slipped 3.5 percent to 3.58 million square meters. Residential projects, however, expanded significantly, rising 34.3 percent to account for more than half of total space. Meanwhile, non-residential floor area contracted sharply by 29.7 percent.

Construction costs also increased markedly, with the average cost per square meter climbing 35.1 percent to P14,882.98. Non-residential buildings remained the most expensive to build, averaging over P24,000 per square meter, with institutional structures posting the highest costs.

The latest figures suggest that while overall construction activity has moderated in volume, investment is shifting toward larger and more complex developments, reflecting evolving demand across sectors.