PH property sector’s 2026 outlook mixed

Expect a “mix of headwinds and tailwinds“ in the Philippine property sector in 2026, said Joey Roi Bondoc, director and head of research at real estate services and investment management firm Colliers Philippines.

On the upside, the Metro Manila office market is showing signs of recovery and will improve next year, Bondoc pointed out, noting the recovery will be driven by IT-BPM firms and traditional corporate occupiers.

Other forecasts, according to Bondoc:

From 2026 to 2028, about 350,000 sq m of new office space will be delivered — significantly lower than pre-pandemic levels, but ensuring manageable supply.

Prime central business districts (CBDs) such as Makati and Bonifacio Global City will lead rental recovery, while flexible workspaces will expand aggressively in Cebu, Pampanga, and Iloilo, supporting decentralization and business continuity strategies.

Unsold houses

On the downside, as of the third quarter, the Metro Manila residential sector had over 30,000 unsold, ready-for-occupancy units for which real estate developers offered promos such as extended payment terms and rent-to-own schemes to increase mid-income sales amid elevated mortgage rates.

However, the C5 Corridor and Katipunan areas continue to draw buyers, with take-up rates reaching up to 100 percent for select projects.

Industrial estate, hotel markets

Central Luzon is seen to dominate the industrial estate market. Colliers projects 870 hectares of industrial land to be delivered from 2026 to 2028, quadruple the pipeline of Southern Luzon.

Despite low foreign visitors, the country’s hotel market benefits from domestic tourism and various meetings, incentives, conferences, and exhibitions (MICE).

Over 3,000 new hotel rooms are to be completed in 2026 in Makati and the Manila Bay Area, Bondoc said.

The retail property trends remain strong, with Metro Manila vacancy to fall below 10 percent by end-2026. Foreign brands and aggressive mall refurbishments are driving demand, while developers expand outside Metro Manila into Cebu, Bacolod, and Davao.

To achieve growth, developers must embrace diversification, invest in emerging growth corridors, and leverage technology-driven solutions to stay competitive amid shifting demand patterns, Bondoc advised.

“To thrive in this cyclical market, developers must future-proof strategies — diversify portfolios, invest in suburban growth corridors, leverage industrial expansion, and embrace flexible workspace solutions. Capitalizing on retail refurbishments and innovative residential promos will be key to staying competitive in the evolving Philippine real estate market,“ Bondoc said.

Source: Manila Times

Moody’s Analytics says 5% PHL GDP target ‘more manageable’

A 5% economic growth target for the Philippines in 2025 will be more realistic, Moody’s Analytics said, with the fourth-quarter performance unlikely to push full-year growth to the 5.5% to 6.5% target.

“A growth rate of around 5% will be more manageable for the country,” Moody’s Analytics Assistant Director and Economist Sarah Tan said.

In the first nine months, gross domestic product (GDP) averaged 5%, pulled down by weak public spending, consumption and investment in the third quarter.

The Development Budget Coordination Committee (DBCC) will review its macroeconomic assumptions and targets next week.

The DBCC first revised its targets in June, trimming its 2025 growth forecast to 5.5–6.5% and the 2026 outlook to 6–7%, citing “heightened global uncertainties” from the Middle East conflict and US tariffs.

Ms. Tan said fourth‑quarter GDP is likely to come in at 5.2%, which if borne out would represent a slowdown from the 5.3% posted a year earlier. It would also be well below the 6.9% needed to hit the 2025 target.

Asked if holiday spending will lift consumption, she said she is now “cautiously optimistic” after the weak third‑quarter performance.

She added the holiday boost may be overshadowed by weak government spending and still‑soft investment appetite.

Economy Secretary Arsenio M. Balisacan has said that he is counting on private spending to rebound on expectations of increased consumption and remittances during the holidays.

Meanwhile, Ms. Tan said one intervention that could boost the economy is rebuilding public trust by speeding up aid disbursement to calamity‑hit communities.

“Perhaps speeding up public spending would then be a positive signal to both investors and consumers that things are moving again,” she said, while adding transparency and accountability may help restore confidence. 

Source: Business World

BPI sees Philippine economy growing at 5% level

Bank of the Philippine Islands (BPI) expects the economy to return to 5% growth next year, calling the third-quarter reading of 4% an anomaly and arguing that the government could eventually get a handle on the issues holding spending back.

“Next year, I think the economy should still grow about 5%. I think the Q3 number might be a one-off. It might spill a little bit to Q4 as the government tries to understand its spending. But I think as we roll into next year, we should hopefully get back to the 5% handle,” BPI President and Chief Executive Officer Teodoro K. Limcaoco told reporters.

Growth of 5% would be lower than the government’s official 6-7% gross domestic product (GDP) growth target for 2026.

Mr. Limcaoco said the third-quarter GDP reading was the result of the government having to rein in spending as it grappled with corruption in public works, particularly flood control projects.

“I guess it’s a little bit disappointing but not quite unexpected. I think the magnitude of the drop was a little surprising to everyone. But we (thought) that Q3 GDP would be slightly lower. We realized that with the current concerns about flood control, that government spending had been, I guess, reduced as they try to get things in order,” he said.

He added that bad weather dampened consumer spending during the period.

“Anecdotally, we’re hearing from our retail clients that September was a pretty weak month, primarily because of the weather,” Mr. Limcaoco said.

GDP grew 4% in the three months to September, the weakest in over four years and well below the 5.5% expansion in the second quarter and the 5.2% clip from a year earlier.

In the first nine months, GDP averaged 5%, well behind the pace of the government’s 5.5%-6.5% full-year target.

Mr. Limcaoco said the muted third quarter growth reading, paired with controlled inflation, points to a rate cut by the Bangko Sentral ng Pilipinas (BSP) in December.

However, he noted the central bank still needs to weigh how the Federal Reserve’s own easing cycle affects the peso.

“Obviously, some economists are saying that with the 4% Q3 growth, that there’s room for the BSP to cut. I think the BSP will have to take a look also at what the Fed is doing because they’ve got to watch out. Otherwise, there (could be an impact on) the currency,” he said.

The BSP last month reduced benchmark rates by 25 bps for a fourth straight meeting, bringing the policy rate to 4.75%. Since starting its easing cycle in August last year, the Monetary Board has cut rates by a total of 175 bps.

BSP Governor Eli M. Remolona, Jr. has said that another cut is possible at the central bank’s Dec. 11 meeting and further into next year amid a softening growth outlook.

Source: Business World