PH property market ‘poised’ for rebound in 2022 — Colliers

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Metro Manila (CNN Philippines, December 21) — The country’s real estate sector is all set to bounce back this new year with the progress in the national vaccination efforts and confidence among the public, according to Colliers International Philippines’ latest report.

“The Philippine property market is poised for a rebound in 2022. The improving vaccination rate complemented by rising consumer and business confidence should inject a much-needed boost to the sector,” said the property consulting firm in its 2022 outlook report published Monday.

Economic recovery is expected to benefit the country’s office, residential, retail, and industrial sectors, Colliers Research Associate Director Joey Roi Bondoc further explained.

Colliers logged 302,600 square meters (sq.m.) of office deals in the nine-month period ending in September, jumping 2% from the same timeframe last year. Over 60% of total transactions were done by traditional occupiers like legal, engineering and construction companies; government agencies; and flexible workspace operators, it added.

“Despite the implementation of work-from-home (WFH) arrangements, some firms, including outsourcing companies, continue to look for office space across the country. We see these leasing queries materializing over the next 12 months which would anchor a recovery in office space take-up within and outside Metro Manila,” it said.

In an email to CNN Philippines, Colliers Office Services Director Maricris Sarino also emphasized that office occupiers are ensuring their layouts adhere to physical distancing requirements and placing equipment ensuring contactless activities and constantly clean air in light of the more transmissible Omicron variant.

New office space supply is expected to reach 723,400 sq.m. next year, with deals beginning to pick up not only within Metro Manila but outside, too.

Other sectors

For the residential sector, Colliers pegs about 9,700 units to be delivered in total this 2022 — climbing by 18% from this year — with prices and rents slated to recover as well.

“Colliers believes that the government’s decentralization program and major public infrastructure projects should push developers to launch more master-planned communities outside of Metro Manila,” the report read.

Colliers cited the likes of the NLEX-SLEX Connector, North-South Commuter Railway, along with the Bulacan International Airport and the expansion of the Clark International Airport as major projects improving connectivity and raising land values outside the metropolis.

The consulting firm also sees local tourism driving the recovery of the leisure sector this 2022, citing Department of Tourism figures stating domestic trips could reach 84.8 million next year. This is about 90% of total trips made in 2019, the year before COVID-19 hit the country.

“Colliers is optimistic that revenge travel among local travelers should help increase hotel occupancies of selected hotels across the country,” it said, adding it expects 1,900 rooms to be completed in the capital region alone.

Meanwhile, an estimated 523,700 sq.m. new retail spaces are expected to go online next year, according to Colliers.

However, the company also recommends that retailers expand their online presence and maximize technological advances with the popularity of e-commerce, enjoining brick-and-mortar stores to be “proactive” in partnering with mobile wallet apps.

Mall operators are also advised to exercise flexibility in the way they use spaces. For instance, they can open pop-up stores while utilizing available facilities like activity centers for inoculation activities and introducing alternative dining options like park-and-dines and al fresco dining.

The company likewise expects the sustained demand in e-commerce, logistics, and manufacturing across the Philippines to still drive the growth of the industrial sector beginning 2022.

Cold storage facilities are forecasted to support demand for industrial assets in the next 12 to 36 months, in line with efforts to ramp up COVID-19 vaccination outside the metro and the growth of grocery and perishable food item deliveries.

“Colliers believes that developers can further capture the rising opportunities in the industrial sector by refurbishing existing warehouse facilities. We encourage developers to utilize advanced-technology such as facility automation, artificial intelligence (AI) systems, and cloudmanaged IT solutions,” it said.

In sum, Sarino stressed that it’s vital for the Philippine real estate sector that authorities keep minimum restrictions of mandating face mask and social distancing to ensure stricter quarantine measures won’t return this 2022.