Colliers identified key issues and opportunities in the Philippine property market particularly in the office, residential, hotel and industrial sectors.
We are pleased to share that our property market reports for the 1st quarter of 2020 are now available. Read about the latest key updates on the Philippine property industry, the impact of the COVID-19 pandemic to the office, residential and retail sectors and our recommendations to industry stakeholders moving forward.
HOW LANDLORDS & TENANTS SHOULD REPOSITION POST-PANDEMIC:
Opportunities for Metro Manila office stakeholders as market recovers post-COVID19
Colliers sees higher office vacancy in 2020 due to a slowdown in leasing activities following the adverse impacts of the pandemic and lockdown in Luzon. Economic analysts and the head of the Philippine central bank are expecting a recovery in 2021 and this should support expansion of business activities and leasing deals.
Colliers recommends that landlords highlight their property management capabilities; proactively attract non-POGOs and work with existing and potential tenants in providing flexible lease terms.
Meanwhile, tenants should adopt modern technology and a flex and core strategy; rethink business continuity plans; and revisit CBD buildings that may now offer more flexible terms.
OPPORTUNITIES FOR CONDOMINIUM DEVELOPERS AND BUYERS:
Softer residential demand in 2020 but economic and office leasing expansion to aid recovery in 2021
Colliers expects residential demand in Metro Manila to soften in 2020 due to the impact of the COVID-19 pandemic. If the virus is contained in H1 2020, we see market sentiment improving from Q3 2020 and a recovery in both demand and supply in 2021.
To take advantage of the recovery, Colliers encourages developers to highlight high-quality property management with a focus on sanitation and emergency preparedness, implement creative lease terms for Ready-for-Occupancy (RFO) units, and offer flexible payment terms to attract buyers, especially as pent-up demand starts to be released in 2021.
Meanwhile, we encourage buyers to take advantage of more attractive pricing in the market, especially for mid-income1condominium units.
EXPANDING ONLINE STRATEGY AMID COVID-19
Mall operators and retailers tweak strategies to respond to challenges posed by the global pandemic
The slowdown of the country’s economy, erosion of consumer confidence as well as implementation of physical distancing measures are likely to adversely impact retail demand in Metro Manila. As a result, we see vacancy rising in 2020 before a slow recovery in 2021 and 2022.
To seize upon opportunities presented by improved market sentiment, we encourage mall operators to:
˃Line up marketing efforts to recapture demand once the pandemic wanes
˃Provide short-term rental relief measures to support retailers
˃Ensure maximum hygiene standards in malls
Meanwhile, we recommend that retailers expand their online presence and target the elderly.