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

Investors’ shifting needs drive upgrades in industrial real estate

Industrial property developers are expanding their land holdings and upgrading facilities to meet the evolving requirements of local and foreign investors, according to industry executives.

“We recognize the importance of staying competitive in terms of infrastructure and capacity, hence we continuously invest in modernizing our facilities, expanding our footprint, and applying efficient, space-maximizing design principles to optimize land use,” Damosa Land, Inc. (DLI) President Ricardo F. Lagdameo said.

“We provide a range of options — from ready-built facilities (RBFs) and warehouses that enable companies to quickly begin operations, to industrial lots for lease or sale for those who wish to construct purpose-built facilities,” Mr. Lagdameo also said.

“This dual offering allows investors to jumpstart their activities in RBFs while their custom facilities are being built, significantly reducing time-to-market.”

The company is also exploring opportunities for horizontal and vertical developments to address the changing needs of its locators, he added.

DLI operates Anflo Industrial Estate (AIE), a 63-hectare special economic zone in Panabo City, Davao del Norte, which hosts 24 locators from six countries.

The Philippines risks missing out on opportunities to attract industrial investments due to limited and aging inventory, according to real estate services and investment firm CBRE.

Industrial property developers said global investors are now seeking strategic hubs that support long-term growth.

“Today, it’s no longer enough to simply offer land or build traditional industrial estates. What global investors need is certainty, scalability, and speed to market,” said Aboitiz InfraCapital, Inc. (AIC), the infrastructure arm of the Aboitiz group.

To meet growing demand, AIC said it has been expanding its industrial landbank annually.

“We continuously open new inventory year after year to meet growing demand, backed by a total landbank of nearly 2,000 hectares of industrial land. This gives locators the ability to scale confidently over time, knowing the space and support will be there as they grow,” it said.

AIC currently offers over 60 hectares of available industrial inventory across its four economic estates: LIMA Estate in Batangas, TARI Estate in Tarlac, and the West Cebu Estate and Mactan Economic Zone 2 Estate in Cebu.

Lot sizes range from two to four hectares and are expandable depending on locator requirements, AIC said.

Tarlac-based Victoria Industrial Park (VIP) has focused on providing fully developed industrial lots with modern infrastructure rather than pre-built warehouses, according to Chief Executive Officer Melissa Yeung-Yap.

“This design philosophy empowers companies to build facilities precisely tailored to their specific operational requirements and international standards from the ground up,” she said.

The masterplan for the 30-hectare VIP, which opened in May, also prioritizes efficient internal flow, disaster resilience, and future expansions, Ms. Yeung-Yap said.

“This proactive approach ensures that businesses can scale operations seamlessly as they grow, and their facilities remain relevant and efficient for decades to come, mitigating the challenges posed by limited space and outdated infrastructure,” she added.

Sustainability has also become a key consideration among global locators, developers said.

“Our flexible space solutions — including RBFs, warehouses, and industrial lots for lease or sale — allow companies to start operations quickly, reducing construction waste and promoting efficient land use,” Mr. Lagdameo said.

AIE has adopted modular and space-efficient designs, as well as sustainable features such as LED lighting, rainwater harvesting systems, and solar-ready infrastructure.

All of AIC’s operating estates have received a 5-Star BERDE (Building for Ecologically Responsive Design Excellence) Certification, the highest rating from the Philippine Green Building Council.

To support sustainability goals, AIC estates also offer renewable energy integration, real-time energy and water monitoring systems, efficient waste management, and green mobility infrastructure, the company said.

“Our investments in smart utilities and resilient infrastructure are designed not only for today’s requirements but to meet the demands of future industries,” it added.

CBRE projects around 79,669 square meters of additional industrial space this year, with most of the upcoming supply located in Laguna, Cavite, and Batangas.

Source: Business World

PHL may need 50M sq.m. of industrial space by 2035

The Philippines may need at least 50 million square meters (sq.m.) of industrial space by 2035, with an estimated average price of P30,000 per sq.m., to accommodate surging demand from the manufacturing, logistics, and data center sectors, according to commercial real estate consultancy firm PRIME Philippines.

“By 2035, the major backbone of the Philippine economy will be the industrial sector. Industrial real estate is no longer just an asset — it’s the key to unlocking the Philippines’ economic future. The demand is here; the supply must follow,” PRIME Philippines Founder and Chief Executive Officer Jet Yu said.

Warehouse supply grew by 4% to 37.6 million sq.m. in 2024, driven by new developments in Laguna, Batangas, and Cebu.

PRIME Philippines projected that supply would breach 40 million sq.m. this year, with upcoming expansions in Rizal, Cavite, Laguna, Pampanga, Cebu, and Davao.

Mr. Yu noted that about a third of the projected demand will come from the development of data centers, with over 100 data centers expected to go live in the country within the next three years.

“The 50 million sq.m. is a conservative-to-optimistic estimate. In just one or two years, we’re going to see many countries, including the Philippines, localizing and housing their own data domestically,” he said.

Mr. Yu added that the country’s manufacturing and logistics sectors are also expected to fuel industrial space demand.

“There has been a rapid decentralization across the Philippines. Logistics players have strategically positioned themselves over the past three to four years,” he said.

“On manufacturing, when many companies from China sought to diversify their operations to other ASEAN neighbors, we somewhat missed that opportunity. However, over the next ten years, we expect significant demand,” he added.

Meanwhile, Mr. Yu said the country’s manufacturing sector could continue to thrive amid geopolitical tensions.

“As long as we play it strategically and carefully, it’s safe to say that the manufacturing sector will continue to thrive in the Philippines,” he said.

“In 2025 alone, we have already received interest from companies looking to expand their existing manufacturing facilities in the Philippines. These are secondary hubs as a way for manufacturers to diversify and mitigate potential risks,” he added.

The United States paused its planned 25% tariffs on Mexico and China in exchange for concessions on border and crime enforcement.

However, US President Donald J. Trump said he is not rushing efforts to defuse a trade war with China, which was triggered by a 10% tariff on all Chinese imports.

In response, China imposed targeted tariffs on US imports and placed several companies, including Google, on notice for possible sanctions.

Source: Business World