Bouncing back from a limited downturn during the global financial crisis, the Philippines' commercial, retail and residential property sectors have proved resilient over the past two to three years, according to market players.
Lindsay Orr, Jones Lang LaSalle chief operating officer for the Philippines, says the main growth demand driver is the business process outsourcing (BPO) sector, which continues to grow at up to 20 per cent a year.
Other sectors, such as financial services and insurance, are creating an additional demand of up to 100,000 square metres (sqm) of space annually. This is likely to continue so long as the Philippines maintains a stable fiscal position and good credit ratings. "The current vacancy rate across all Metro Manila business districts is only 4 per cent and rental rates in many areas have returned to their pre-global-financial-crisis peak levels," Orr says.
Not only is the buoyant real estate market creating jobs within the property sector, the BPO industry is also proving a reliable employment powerhouse.
Last year, 780,000 people worked full time in the BPO sector. About 75 per cent of these IT-BPO jobs are in Metro Manila, with the top sites in Makati, Quezon City, Ortigas, Bonifacio Global City and Mandaluyong, Orr says.
He explains that his company's services include selecting a suitable location and the best developer, and then negotiating favourable lease terms on behalf of the tenant.
"In other instances, we are appointed to lease out office buildings on behalf of the developer and we have a different team of specialists engaged in this side of the business," he says.
Other popular BPO locations have been the Central Visayas hub, where there are now around 50,000 full-time employees, the majority being in Cebu City; and the Western Visayas hub, where there are around 25,000 BPO employees.
A similar picture can be seen in Central Luzon, while a slightly lower employment figure can be found in the provinces of Laguna, Batangas and Cavite to the south of Manila.
Outside of Metro Manila, the top BPO locations are Cebu, Laguna, Bacolod, Davao, Baguio, Iloilo and Pampanga. "All of these locations show great promise and are sure to do well over the next few years," Orr says.
In the retail sector, he says the total supply throughout the Philippines last year was 12.8 million sqm. This is predominantly in shopping mall developments, of which 6.7 million sqm was in Metro Manila and 6.1 million sqm in provincial locations.
In the residential sector, the most dramatic growth over the past few years has been in condominium developments.