Data Centers Become Real Estate Assets: PLDT’s Planned REIT Signals a New Property Trend

For decades, Philippine real estate investing has largely revolved around residential subdivisions, condominiums, office towers, shopping malls, and industrial parks. Today, however, a new property asset class is beginning to attract the attention of investors: data centers.

The Philippines data center construction market size reached USD 525.2 Million in 2025 and is projected to reach USD 1,611.5 Million by 2034

The planned inclusion of data center assets in a Real Estate Investment Trust (REIT) portfolio signals a significant shift in how investors view real estate. What was once considered purely a technology infrastructure business is increasingly being recognized as a valuable and income-generating real estate asset.

As digital transformation accelerates across the Philippines, data centers may become one of the most important property sectors of the next decade.

What Is a Data Center?

A data center is a specialized facility that houses computer servers, networking equipment, storage systems, and other critical digital infrastructure. These facilities store, process, and distribute the enormous volumes of data required by businesses, government agencies, financial institutions, cloud computing providers, and online platforms.

Unlike traditional office buildings, data centers are designed to provide:

• High levels of security

• Reliable power supply

• Redundant backup systems

• Advanced cooling infrastructure

• High-speed telecommunications connectivity

Because businesses increasingly depend on digital operations, demand for secure and reliable data center space continues to grow.

Why Investors Are Paying Attention

Data centers generate revenue through long-term lease agreements with technology companies, cloud service providers, telecommunications firms, banks, and other enterprise clients.

This creates several characteristics that appeal to investors:

Stable Rental Income

Many tenants sign multi-year contracts, providing predictable revenue streams that resemble those found in traditional commercial real estate.

High Occupancy Potential

As businesses continue migrating operations to digital platforms, demand for server space and cloud infrastructure remains strong.

Growth Linked to Technology

Unlike some traditional property sectors that depend heavily on consumer spending, data centers benefit from the ongoing expansion of digital services, artificial intelligence, e-commerce, online banking, and remote work.

Limited Competition

Building a modern data center requires significant capital investment, specialized expertise, and access to robust telecommunications infrastructure, creating barriers to entry for competitors.

A New Type of REIT Asset

The Philippine REIT market has traditionally focused on office buildings, retail centers, and mixed-use developments. The inclusion of data centers introduces a new category that may diversify investor portfolios.

For investors, this means exposure to both real estate and the digital economy through a single investment vehicle.

The trend mirrors developments in more mature markets where data center REITs have become major components of institutional investment portfolios. Some of the world's largest real estate trusts now derive substantial income from digital infrastructure assets.

What This Means for Philippine Real Estate

The rise of data centers could have broader implications for the property sector.

Increased Demand for Strategic Land

Data centers require carefully selected locations with reliable power, fiber connectivity, and access to major business hubs. This could increase demand for land in specific growth corridors and industrial zones.

Infrastructure-Led Property Growth

Areas with strong telecommunications networks and stable power infrastructure may become increasingly attractive to developers and investors.

Expansion of Industrial and Technology Parks

Industrial estates and business parks may see growing interest from technology-focused locators seeking facilities for data processing and cloud services.

New Investment Opportunities

Property investors who traditionally focused on residential or office assets may gain access to a sector benefiting from long-term technological trends.

Challenges Remain

While the outlook is promising, data centers are not without risks.

They require substantial capital expenditure, consume large amounts of electricity, and depend on reliable utility infrastructure. Competition from regional markets may also influence future growth.

Additionally, technological advancements can quickly change facility requirements, requiring operators to continually invest in upgrades and modernization.

Investors should therefore evaluate data center assets with the same level of due diligence applied to traditional real estate investments.

The Future of Digital Real Estate

The growing recognition of data centers as income-producing real estate reflects a broader transformation occurring throughout the global property industry.

As economies become increasingly digital, the infrastructure that supports online activity is becoming just as valuable as office buildings, shopping centers, and residential communities.

For Philippine real estate investors, the emergence of data center assets represents more than a new investment opportunity. It signals the evolution of the property market itself, where digital infrastructure and real estate are becoming increasingly interconnected.

The next major real estate boom may not be driven solely by where people live, shop, or work—but also by where their data is stored, processed, and transmitted.

Source: Ziggurat Real Estate

Using a Foreign Address in a Philippine Deed of Absolute Sale

Using a Foreign Address in a Philippine Deed of Absolute Sale: What the Law Allows and What You Should Do

In an increasingly global property market, it’s common for buyers and sellers of Philippine real estate to live abroad. A frequent question arises: Can a foreign address be used in a Deed of Absolute Sale?

The short answer is yes—but there are important legal and practical considerations to ensure your transaction proceeds smoothly.

Legal Basis: Identification Matters More Than Location

Under the Civil Code of the Philippines, the validity of a contract—such as a Deed of Absolute Sale—depends on essential elements like consent, object, and cause. The law does not require that parties reside in the Philippines or use a local address.

What matters is that the parties are:

• Properly identified

• Legally capable to contract

• Clearly described in the document

A foreign address, therefore, is legally acceptable as long as it accurately identifies the party.

Why the Address Still Matters

Even if the law allows a foreign address, its inclusion in the deed serves several practical purposes:

• Identity verification – distinguishes parties with similar names

• Jurisdictional context – indicates residency or domicile

• Service of notices – provides a reference for legal communication

Because of these functions, clarity and completeness of the address are essential.

Best Practice: Use Both Foreign and Local Addresses

While a foreign address is valid, experienced practitioners often recommend including both:

• Permanent foreign address, and

• Temporary or local Philippine address (if available)

Example Clause:

“John Doe, of legal age, American, married, with residence at 123 Main Street, Los Angeles, California, USA, and presently staying at Cebu City, Philippines.”

This dual-address approach helps facilitate smoother transactions with government offices and reduces delays.

Requirements from Government Agencies

In practice, agencies involved in property transfers may require additional details regardless of the address used.

Bureau of Internal Revenue

The BIR requires:

• A Tax Identification Number (TIN) for all parties (including foreigners)

• Consistency between the name in the deed and supporting IDs

• Payment of applicable taxes (Capital Gains Tax, Documentary Stamp Tax, etc.)

Registry of Deeds

For registration of the property transfer:

• The deed must be notarized

• Names and details must match identification documents

• Supporting documents (tax clearances, transfer certificates) must be complete

A local contact address can sometimes make follow-ups easier during processing.

If the Deed Is Signed Abroad

When one or both parties are outside the Philippines at the time of signing, additional steps are required:

• Notarization before a Philippine Consulate, or

• Apostille authentication (for countries part of the Apostille Convention)

This ensures that the document is recognized as valid in the Philippines.

Common Pitfalls to Avoid

Even though using a foreign address is straightforward, mistakes can cause delays or rejection:

• Incomplete addresses (missing country or postal code)

• Mismatch with IDs or passports

• Failure to secure a TIN for foreign parties

• Improper notarization or lack of apostille

• No local contact when agencies need follow-up

Practical Tips for Buyers and Sellers

To avoid complications, consider the following:

1. Match your documents Ensure the name and address in the deed align with your passport or valid ID.

2. Secure a TIN early Foreign buyers and sellers must obtain a TIN before processing taxes.

3. Include a Philippine contact address Even if optional, it speeds up communication with local agencies.

4. Coordinate notarization properly If abroad, confirm whether consular notarization or apostille is required.

5. Work with experienced professionals A knowledgeable broker, lawyer, or notary can prevent costly delays.

Final Thoughts

Using a foreign address in a Philippine Deed of Absolute Sale is perfectly legal and increasingly common. However, the success of your transaction depends on proper documentation, compliance with tax and registration requirements, and attention to detail.

In cross-border property deals, small oversights can lead to significant delays—so it pays to get everything right from the start.

Source: Ziggurat Real Estate

Developers urged to grow industrial segment to attract foreign expansion

Property developers must consider expanding their presence in the industrial segment to attract foreign companies diversifying their supply chains, property consultancy Colliers Philippines said.

In its first half Metro Manila Industrial Report, Colliers said China and Taiwan companies that have shown interest in expanding here.

“The Philippines needs an efficient supply chain system to capture investments amid Trump’s new tariff impositions,” Colliers said.

“This is also crucial in future-proofing the industrial sector, enabling the Philippines to attract foreign direct investment amid challenges posed by elevated tariffs.”

US President Donald J. Trump in July imposed a 19% tariff on exports from the Philippines, Cambodia, Malaysia, Thailand and Indonesia.

According to Colliers, property firms must consider developing industrial parks and facilities to cater to more locators. It also cited opportunities to expand in Central Luzon, which hosts high-value manufacturers in industries like pharmaceuticals, fiber cement products, tire, and semiconductor segments. 

In Central Luzon, Colliers projects 900 hectares of new industrial space to be delivered between 2025 through 2028.

“The development of new industrial parks and facilities in central and southern Luzon should provide potential locators with more options and opportunities to haggle for more attractive land leasehold and warehouse lease rates,” Colliers said.

For the second half of the year, semiconductors, consumer goods, cosmetics, and automotive firms are expected to drive demand in the industrial segment.

“Industrial space absorption should partly be supported by Chinese and Taiwanese firms expanding in the Philippines. Colliers sees the Philippines likely benefiting from the China+1 strategy,” according to the report.

The China+1 strategy refers to China-based companies diversifying their production operations to add more sites.

Colliers also cited the potential of ‘sunrise industries’ such as electric vehicles (EVs), as it expects more interest from EV firms looking for an industrial base in the region.

“Over the near to medium term, the Philippine government should entice other thriving sectors such as pharmaceutical firms and encourage them to manufacture in the Philippines,” it said.

Source: Business World