Metro Manila office rents seen to rise in some districts, analysts say

METRO MANILA’s key business districts are expected to face upward pressure on office rents this year, driven by strong demand from multinational firms and business process outsourcing tenants, analysts said.

“Rental performance will continue to be highly district-specific,” Mikko Barranda, director for commercial leasing at Leechiu Property Consultants, said in an e-mailed reply to questions.

Submarkets such as Bonifacio Global City (BGC) are likely to see upward pressure on rents as demand outpaces available supply, he said.

BGC posted the lowest vacancy rate among Metro Manila office submarkets at 9% as of end-2025, according to Leechiu Property Consultants’ Fourth-Quarter Property Market Report.

In contrast, districts with double-digit vacancy rates include Makati City (15%), Ortigas and Mandaluyong City (18%), Quezon City (19%), Taguig City (21%), Alabang (23%), and the Bay Area (28%).

“This trend will be reinforced by limited new completions and strong flight-to-quality preferences among multinational occupiers,” Mr. Barranda said.

He added that major central business districts (CBDs) such as Makati and BGC are expected to continue benefiting from strong tenant preference, constrained new supply, and sustained interest from multinational companies.

Submarkets with higher vacancy levels, however, may see “relatively flat rental growth in the near term,” he said.

Office rents in Metro Manila will remain a “case-to-case” scenario, said Kevin Jara, head and director of office services — tenant representation at Colliers Philippines.

“In established business districts with limited available space, such as Makati CBD, BGC and Ortigas CBD, we expect modest year-on-year rental growth in the range of 1% to 5%, supported by low vacancy levels,” he said in an e-mail.

“So far, we are not seeing any major space surrenders similar to the levels during the POGO (Philippine Offshore Gaming Operators) exodus, that could materially increase vacancy and put downward pressure on rents,” Mr. Jara noted.

However, Colliers is monitoring potential risks to office demand, including corporate layoffs overseas and the progress of proposed outsourcing-related bills in the United States, he said.

These include the Keep Call Centers in America Act and the Halting International Relocation of Employment (HIRE) Act, which aim to protect US-based call center jobs amid rising offshoring and the use of artificial intelligence-powered bots.

The Keep Call Centers in America Act seeks to limit federal benefits granted to companies that outsource call center jobs overseas.

Meanwhile, US Senate Bill 2976, or the HIRE Act, proposes a 25% excise tax on American firms’ payments to foreign service providers for work consumed in the United States.

Jamie S. Dela Cruz, research manager at Savills Philippines, said office rents in Metro Manila’s CBDs are likely to remain tenant-favorable overall.

She noted that elevated vacancy levels in some districts continue to give locators greater flexibility in lease negotiations, she told BusinessWorld in an e-mail.

“Despite this, office demand continues to be supported by the information technology-business process management sector, as the industry works to remain competitive by enhancing skills and attracting more global shared services,” Ms. Dela Cruz said.

She added that higher-quality, green-certified office buildings continue to command higher asking rents.

“Less competitive office stock that remains vacant could put pressure to the overall market and potentially further soften rental rates,” she said.

Data from Leechiu Property Consultants showed that as of end-2025, BGC remained the most expensive office submarket at P1,167 per square meter (sq.m.), followed by Makati City at P891 per sq.m.

Other office rental rates were recorded in the Bay Area and Pasay City at P798 per sq.m., Alabang and Muntinlupa City at P787 per sq.m., Ortigas and Mandaluyong City at P738 per sq.m., and Taguig City at P724 per sq.m. — Beatriz Marie D. Cruz