Metro Manila condo inventory may take up to three years to clear

Unsold condominium units in Metro Manila could take about two to three years to be fully absorbed, particularly in areas previously occupied by Philippine offshore gaming operators (POGOs), property consultancy Leechiu Property Consultants (LPC) said.

“I think it will still take about two years, probably three years, to clear out the POGO-induced supply, especially in central business districts where there was heavy POGO presence,” Roy Amado L. Golez, Jr., LPC director for research, consultancy, and valuation, told a media briefing on Wednesday.

As of end-November 2025, Metro Manila’s middle-income condominium inventory rose to 80,300 units across 578 actively selling buildings, up from 74,600 units in the previous quarter. This represents roughly three years and six months of available supply.

Of the total, 53,900 units are pre-selling, while 26,400 are ready-for-occupancy. Quezon City recorded the highest number of unsold condominiums at 19,300 units, followed by the Ortigas area and the cities of Mandaluyong, Pasig, and San Juan with 14,200 units, and the Bay Area with 13,000 units.

Metro Manila continues to grapple with an oversupply of units in the upper middle income to upscale segments, typically priced between P4 million and P12 million, particularly in areas affected by last year’s government POGO ban.

“Fewer speculative buyers dampen primary take-up, while motivated sellers from the POGO period compete in the secondary market with aggressive pricing, further slowing absorption,” LPC said.

Residential demand in the first 11 months of 2025 fell to a six-year low of 24,732 units, down from 42,563 units sold in the same period of 2020. Year on year, units sold declined by 3% from 25,565 units in the first 11 months of 2024.

“But then, there’s still one more month to go, so hopefully developers can sweep all the potential sales and catch up,” Mr. Golez said.

New condominium launches as of end-November dropped by 60% to 5,256 units from 13,226 units a year ago, marking the lowest level since 29,739 units launched in 2020.

“We have a market here where developers are conscious of inventory and are also experiencing low sales. At the same time, reservation sales and actual sales have been flattening or tapering off,” Mr. Golez said.

“The issue in the last few years is that price increases have been too aggressive for many developers,” he added.

Despite the high inventory of unsold units, the Philippines continues to face a growing housing backlog, Mr. Golez noted.

In the office sector, global capability centers (GCCs) — firms specializing in healthcare, finance, and other services — are expected to drive tenant demand in 2026.

“As we enter next year, there is a high probability that tenants will continue to require spaces of 5,000 to 10,000 square meters (sq.m.), especially among global capability centers,” LPC Director for Commercial Leasing Mikko Barranda said.

Year-to-date, office leasing demand in Metro Manila grew 10% to 1.22 million sq.m. from 1.11 million sq.m. during the same period in 2024. The information technology-business process management sector accounted for 549,000 sq.m., followed by traditional firms at 563,000 sq.m., global capability centers at 174,000 sq.m., and government tenants at 74,000 sq.m.

Vacated office space in the fourth quarter fell 59% to 85,000 sq.m. from 205,000 sq.m. in the previous quarter. Year-to-date, LPC recorded 744,000 sq.m. of vacated space.

“As tenants realize that certain districts have a very tight market for certain space sizes, we will likely see spillover activity into other districts,” Mr. Barranda said.

At present, Metro Manila has an office vacancy of 18%, with Bonifacio Global City still the most favored location with a 9% vacancy rate, followed by Makati City at 15%.

Source: Business World

New mid-income condo launches unlikely in the next 3 to 4 years

It may take up to four years before launches of new middle-income residential condominium projects in Metro Manila begin picking up again, amid lingering oversupply in the market, according to real estate consultancy firm Cushman & Wakefield.

“Based on historical experience, it will take about three to four years before the market begins to react again and new launches will be announced,” Claro dG. Cordero, Jr., director and head of research, consulting and advisory services at Cushman & Wakefield, said at a news briefing.

The Metro Manila condominium market, particularly for the middle-income segment, continues to experience excess inventory, Cushman & Wakefield said.

“Prior to the pandemic, I think the annual launches were about, on average, 15,000 units a year from around 2005 up to 2020. After the pandemic, we noticed that the launches have gone down to about 5,000 [units] annually,” Mr. Cordero said.

In its first-quarter property market report, Cushman & Wakefield estimated there are around 450,000 units available in the middle-income and high-end segment.

Mr. Cordero said the high-end residential condominium segment has maintained its growth momentum, while noting an increasing demand for house and lot properties outside Metro Manila.

“For residential condominium markets, investors are shifting again towards high-end residential for capital appreciation, and rental yields have remained attractive in major central business districts like Makati, Ortigas, and Bonifacio Global City,” he said.

This year, Cushman & Wakefield said around 5,000 units will be added to the available supply in Metro Manila, covering middle-income to luxury residential segments.

Meanwhile, high vacancy rates persist in the office sector due to hybrid work schemes, policy changes and the exit of Philippine offshore gaming operators (POGO), Mr. Cordero said.

He said the Metro Manila office vacancy rate rose to 17.3% in the first quarter, from 16.5% in the same period a year ago.

The Metro Manila office sector has a consolidated stock of 9.83 million square meters (sq.m.), mostly Prime and Grade “A” facilities. About 69,200 sq.m. of new supply was added in the first quarter, Mr. Cordero said.

“We’re looking at again more than half a million square meters [of new supply] by end of 2025 mainly coming from Quezon City, Makati and Taguig,” he also said. “We’re looking at persistently high vacancy rates over the next few quarters.”

In the first three months of the year, headline rents averaged P987 per sq.m. per month — declining annually by 2.4% — reflecting pressures from excess supply in the market, Mr. Cordero said.

Despite a positive net absorption of 32,000 sq.m. year-to-date, demand remains “on the low side” due to office spaces that have remained vacant since the exit of POGOs.

“The overall absorption rate is positive, but some areas like Parañaque and Quezon City still have negative absorption figures because of the amount of spaces vacated by the POGO industry,” Mr. Cordero said.

To attract tenants, office developers in Metro Manila should consider offering flexible leasing strategies and fit-out incentives, Mr. Cordero said.

Meanwhile, the retail sector is expected to stay resilient, driven by the growing middle class as well as new commercial developments outside the Philippine capital.

“We’re seeing a significant supply of new shopping mall developments outside of Metro Manila primarily by SM [Prime Holdings, Inc.] and Ayala [Land, Inc.],” Mr. Cordero said.

These malls are expected to complement developers’ township projects in regional areas, he added.

Cushman & Wakefield said around 250,000 sq.m. of new retail spaces came online in the January-March period, while it expects a total of 345,000 sq.m. to be completed by end-2025.

Source: Business World

Metro Manila condo launches fell to lowest level in 5 years

New condominium launches in Metro Manila slumped to a five-year low in the first quarter, as property developers focus on clearing their existing inventory, according to property consultancy firm Leechiu Property Consultants (LPC).

LPC’s latest Philippine Property Market Report showed new condominium launches in Metro Manila plunged by 77% to 1,347 units in the January-to-March period from 5,928 units in the fourth quarter of 2024.

This was also the lowest number of units launched since the 9,392 units in the first quarter of 2020 when the coronavirus disease 2019 (COVID-19) pandemic began.

In a statement, LPC said developers are “focusing on marketing existing inventory, particularly within the midrange segment, before rolling out new projects.”

Leechiu Director for Research and Consultancy Roy Amado L. Golez, Jr. said the drop in new residential condominium projects reflects developers’ lack of confidence in the market.

“The significant number of supply in the market dictates that developers will slow down their launches. But then at the end of the year, we’ll likely see the same blip upwards in terms of total supply,” he said at a media briefing.

LPC data showed a 14% quarter-on-quarter improvement in sales take-up with 6,500 units sold in the first quarter, amid rate cuts by the central bank. However, this was a far cry from the 13,246 units sold in the first quarter of 2020.

The Bangko Sentral ng Pilipinas (BSP) cut rates by 75 basis points in 2024, bringing the key rate to 5.75%. The BSP has signaled it will continue easing this year.

“We’ve seen a good start for the year for the residential market. But we need to move with caution for now due to very recent developments in the world capital markets. For developers, they will need to be more aggressive with their marketing: their promos and payment terms,” Mr. Golez said.

Mr. Golez said buyers should take advantage of “a short window of opportunity to acquire property at favorable terms while supply is not yet at comfortable levels.”

Metro Manila still has an oversupply of condominiums, mainly in the mid-market to upscale segments and in areas outside central business districts that were affected by the government’s ban on Philippine offshore gaming operators (POGO).

As of end-March, LPC data showed Metro Manila had about 81,400 available condo units, which may take 38 months or about three years to be fully sold.

“Most developers, or practically all, are reluctant to decrease prices. But in effect, what they’re trying to do is offer decreased prices by offering discounts as well as extended payment terms,” Mr. Golez said.

Mr. Golez said he expects developers to limit their project launches for the next six months.

“In the next six months, I think these (launches) will remain low, but as take-up improves, I think they will recover, because now, there are only limited launches,” he told BusinessWorld after the briefing.

Meanwhile, the office market saw a 7% year-on-year increase in demand of 355,000 square meters (sq.m.) despite the absence of POGOs and limited government take-up, LPC said.

“The main difference between this quarter and the first quarter of 2024 is the 56% increase in BPO (business process outsourcing) demand coming from specifically one segment, which are the global in-house centers,” Mikko Baranda, LPC director for commercial leasing, told the briefing.

Global in-house centers are involved in healthcare, banking, financial services, and insurance sectors.

“A lot of these companies, and probably also predicated with what’s happening all over the world, are looking at the Philippines again to offshore and outsource work,” Mr. Baranda said, citing foreign companies like JPMorgan keen on growing their footprint in the country.

In the first quarter, lease transactions involving IT-BPOs reached 185,000 sq.m. of office space, while those for traditional offices reached 94,000 sq.m.

The nationwide office vacancy rate stood at 17% in the first quarter. In Metro Manila, the office vacancy rate stood at 16% — with the highest in Taguig at 24% and the lowest in Bonifacio Global City (10%).

For 2025, office net take-up is expected to jump by an annual 16% to 490,000 sq.m.

“The office market in the Philippines continues to show grit in the face of global and local challenges. The IT-BPM sector remains to be a reliable key driver of growth, while traditional office tenants are also increasingly active. With a promising outlook for the rest of the year, we expect resiliency amidst potential headwinds,” Mr. Baranda said.

LPC said a total of 2 million sq.m. is forecast to be added to the Philippine office supply in the next four years.

Meanwhile, the country’s retail market has already recovered from the pandemic.

“The general population has largely come back to the malls, and back to their consumption behavior. Developers are largely confident of the market with 105 malls upcoming nationwide [in the next six years],” Mr. Golez said. 

By developer, SM Prime Holdings, Inc. accounted for 29% of upcoming malls, followed by Robinsons Land Corp. at 28%, and DoubleDragon Corp. at 15%. Other developers expected to launch new malls in the six-year period include Ayala Land, Inc. (10%), Megaworld Corp. (7%), and Rockwell Land Corp. (2%).

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Source: Manila Times