Manila hotel sector may expand by nearly 2,900 keys this year — Colliers

Metro Manila set to add 2,890 hotel keys in 2026, with most of the new rooms concentrated in Makati and the Bay Area, according to Colliers Philippines.

In its Second-Half (H2 2025) Metro Manila Hotel Report, Colliers projected that over two-thirds of the new supply this year will come from hotels in the Makati central business district and the Bay Area.

“The Philippines recorded dismal aggregate international arrivals in 2025. The country has yet to recover pre-covid visitors. Despite this, domestic travelers continue to drive take-up for hotels and MICE (meetings, incentives, conferences, and events) facilities across the country,” Joey Roi H. Bondoc, director and head of research at Colliers Philippines, said in the report.

From 2026 to 2029, Colliers projects 1,800 rooms to be delivered annually. About 52% of the new supply in Metro Manila during this period will come from foreign hospitality brands such as Mandarin, Dusit, Canopy, and Moxy.

Colliers expects hotel occupancy this year to reach around 60%, amid the addition of new rooms and limited international arrivals.

The consultancy noted that the Philippines’ tourist arrivals remain “disappointingly low,” as neighboring countries such as Vietnam and Malaysia have exceeded their pre-pandemic visitor levels.

Tourist arrivals in the Philippines reached 6.48 million in 2025, according to the Bureau of Immigration, below the pre-pandemic level of 8.26 million in 2019.

The country has faced challenges in attracting international visitors compared with regional peers, amid congested airports, limited inter-island connectivity, and underdeveloped transport infrastructure.

Domestic travelers continue to influence hotel occupancy and daily rates, particularly in Metro Manila, Cebu, Cagayan de Oro, Davao, and Clark, Pampanga.

The hosting of the ASEAN Summit this year is expected to support the country as a MICE destination, Colliers added.

In-person events such as pharmaceutical product launches, property exhibits, bridal fairs, technology trade shows, and travel and tourism expos can further support MICE and accommodation demand, the report said.

“In our view, the government should focus on expanding and diversifying the Philippines’ leisure demand base, with some countries from Europe and the Middle East being the ‘low-hanging fruits,’” Colliers said.

Hotel operators are advised to target long-haul and high-spending tourists, noting that new international flights have been introduced from countries such as Russia, Palau, Canada, and India.

Developers are encouraged to consider an “asset-light strategy” for hotel expansion, Colliers said.

“This model allows foreign brands to enter into management or franchise contracts with local developers, reducing capital expenditure while providing stable, predictable returns for property owners, creating a mutually beneficial arrangement for both parties,” it said.

Hotel joint ventures that have adopted the “asset-light” model include partnerships between The Ascott Limited and DoubleDragon Corp., and between Ayala Land Hospitality with Marriott International, Inc. and Hilton Worldwide Holdings, Inc.

Developers should also take advantage of new policies that could support tourism growth, including the issuance of digital nomad visas, the Cruise Visa Waiver Program, and visa-free entry for Indian and Chinese tourists, Colliers said.

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Source: Business World

Colliers says housing prices may have recovered in Q4

Residential property prices may have picked up in the fourth quarter after the slump a quarter earlier, Colliers Philippines said.

“Similar to what we have seen previously, the fourth quarter is traditionally a strong quarter for residential take-up whether within or outside Metro Manila, whether it’s condominiums or horizontal,” Joey Roi H. Bondoc, director and head of research at Colliers Philippines, said.

The Bangko Sentral ng Pilipinas (BSP) Residential Property Price Index indicated that housing prices nationwide posted its weakest growth ever in the third quarter at 1.9%.

This was a sharp slowdown from the 7.5% growth posted in the three months to June and the year-earlier 7.6%.

The BSP also reported that lower real estate investment brought banks and trust entities’ real estate exposure down to 19.54% at the end of September from 19.61% at the end of June and 19.55% a year earlier.

Real estate loans climbed 8.9% year on year to P3.096 trillion at the end of September, but real estate investment slipped 5.75% to P354.749 billion.

Mr. Bondoc said yearend bonuses and inflows of remittances from overseas Filipino workers could have spurred demand for residential property in the fourth quarter.

He also noted that the peso’s recent weakness may prompt migrants, especially those from North America, to send more money home.

The peso has been trading between P58 to P59 to the dollar since October, hitting a fresh record low of P59.22 on Dec. 9.

However, Mr. Bondoc said elevated mortgage rates may still continue to dampen housing price growth in the near term, but any potential rate reduction could help property take up and price growth by this quarter next year.

“I think we need to watch out for the… possible reduction in mortgage rates, given that there has been a substantial decline in basic policy rates by the central bank,” he added.

“And if that happens, that will provide a better impetus for a spike in residential demand, and therefore residential prices, starting (in the) first quarter of 2026.”

The BSP ended the year with a fifth straight 25 basis-point (bp) cut on Dec. 11, bringing its total reductions on key borrowing costs to 200 bps since August 2024. The benchmark policy rate is currently at an over three-year low of 4.5%. 

Mr. Bondoc said lowering the mortgage rate between 6% and 6.5% from the current 7.8% could help the property industry by raising confidence among buyers.

“But the concern is that they have not been lowering their mortgage rates,” he added. “If they start doing that next year, 2026, I think (that will be) a very good sign that demand and then prices might recover faster because of this lower mortgage rate.”

Source: Business World

Rezoning and revitalizing Makati CBD

The Makati central business district (CBD) continues to enjoy its stature as the Philippines’ primary financial district. Major outsourcing, multinational, and large Filipino companies gravitate towards the country’s premier financial hub. This has been compelling national developers to expand in the business district despite the obvious lack of developable land in the business hub.

What’s interesting is that there are proposals to amend the zoning ordinance of Makati CBD. Among the Makati Central Estate Association, Inc.’s (MACEA) proposed changes include increasing the allowable floor area ratios (FAR) for office and retail developments. All lots will now be mixed-use. The new zoning ordinance also establishes the “superblocks” system, and a bonus FAR of 1.5 for lot owners that will incorporate breezeways and civic plazas into their developments.

Meanwhile, the Makati local government, major developers, and other stakeholders should also take into account the viability of expanding retail spaces; the city’s sustainability initiatives — given the popularity of healthy and sustainable workspaces; and the efficiency of mass transit systems (especially now that the construction of Makati subway has stalled) and parking spaces across the business district.

TAKING ADVANTAGE OF MAKATI CBD’S DWINDLING AVAILABLE OFFICE SUPPLY

From 2025 to 2029, Colliers projects the delivery of nearly 2 million square meters of new office space in Metro Manila, with Makati CBD accounting for 15% of the new supply. Among the new office towers likely to be completed during the period are Calistoga Office Building, Mckinley Exchange Corporate Center 2, PHC Buendia, The Gentry Corporate Plaza and the redevelopments of BDO, BPI, Metrobank and Chinabank HQs.

Assuming current market conditions continue, Colliers projects that Makati CBD may shift to a landlord’s market as early as next year, due to limited new supply over the next two years. While several major banks are developing new headquarters in the CBD, most of these are expected to be completed by 2029 onwards. The duration of a potential landlord’s market may be protracted unless a substantial portion of space in these HQs is made available for lease to the market.

With office availability dwindling and many existing buildings aging, redevelopment is becoming increasingly imperative to meet evolving demands. Colliers sees the MACEA’s proposed zoning amendments as a key catalyst in driving the redevelopment of the Makati CBD. These proposed changes include increasing the allowable FAR for office developments in Legazpi and Salcedo Villages, as well as permitting mixed-use developments along major thoroughfares. Colliers recommends incentivizing redevelopment projects — particularly those that integrate sustainability — as a critical step in future-proofing the CBD.

NEW CONDOMINIUMS LIKELY TO REPLACE OLD BUILDINGS

From 2025 to 2029, Colliers expects the completion of 20,700 condominium units in Metro Manila, with Makati CBD likely accounting for 12% of the new supply. Majority of these are luxury projects including Arthaland’s Eluria, Alveo Land’s Parkford Suites, and SMDC and Federal Land’s The Estate. Due to the lack of developable land in Makati CBD, property firms have been redeveloping old and existing properties into new residential projects. For instance, Ayala Land Premier redeveloped the Mandarin Oriental Hotel and LeParc Apartments into Park Central Towers and Park Villas respectively. Meanwhile, the Dela Rosa Carpark 2 will be converted into an ultra-luxury project called Laurean.

The proposed Condominium Redevelopment Act, a measure that was seen to complement new office and retail projects in Makati CBD failed to hurdle the last Congress. The bill is likely to be refiled in the next Congress which starts in July. We see Makati CBD benefiting from the measure’s enactment.

Makati CBD’s residential segment remains a cut above the rest. Its share to total unsold ready-for-occupancy (RFO) condominium units is only less than two percent of total unsold RFO across Metro Manila. Secondary and pre-selling condominium projects within Makati CBD are among the more expensive in the metro, especially those along Ayala Avenue and those located in Legaspi and Salcedo villages.

With the proposed rezoning and new projects in the pipeline, Makati CBD is definitely a hub to watch for in the years to come.

Source: Business World