Colliers Philippines expects a rebound for the country’s property market next year on the back of the country’s coronavirus disease 2019 (COVID-19) vaccination rate and improved consumer and business confidence, the real estate services firm said in a report on Monday.
“The Philippine property marketing is raring to roar back in 2022. In our view, office, residential, retail, and industrial sectors will benefit from a macroeconomic rebound,” Colliers Philippines Associate Director Joey Roi H. Bondoc said in the report.
“Landlords should prepare to capture pent-up demand, while tenants and investors should maximize opportunities as the market is on its way to recovery,” he said.
For the office market, Colliers expects the rebound to be supported by the country’s continued COVID-19 vaccination program. It also noted that some companies continued to look for office spaces despite work-from-home arrangements.
In 2022, Colliers expects new office supply to reach 723,400 square meters. It also expects “heightened preference” for sustainable office buildings, with features that allow its spaces to have natural lighting and optimized air quality.
For the residential market, Colliers anticipates increased interest in the northern-central part of Luzon thanks to the upcoming completion of major infrastructure projects and new township projects of property developers.
“Colliers also believes that Bulacan will most likely be an attractive residential investment destination as it will benefit from major infrastructure projects,” the real estate services firm said, citing the completion of the New Manila International Airport and MRT-7.
Meanwhile, Colliers expects consumers to continue shopping online beyond the pandemic and recommends retailers to design stores and spaces that would allow for flexible use, such as hosting COVID-19 vaccination sites, using spaces for pop-up stores, and having alternative dining options for shoppers.
Colliers expects retail vacancy to rise to 17% as 523,700 sq.m. of new retail spaces are completed next year, and as demand remains muted due to changing pandemic restrictions.
“Colliers expects rents to recover slowly starting 2022 with an improved vaccination program and a government-projected economic recovery spurring an increase in consumer spending,” it said.
Meanwhile, Colliers noted that the Department of Tourism is expecting domestic trips to reach 84.8 million next year. The real estate services firm expects hotel demand to be spurred by local travelers, while “slow recovery” with foreign tourists is anticipated to begin in 2023.
On the other hand, the growth of the industrial property sector will be supported by the growing e-commerce market, logistics sector, and manufacturing sectors.
Colliers recommends developers to look into expanding via cold chain facilities as demand is expected to be maintained for the next three years.
Colliers said renovating existing warehouse facilities can help firms maximize opportunities seen for the upcoming year.
“We encourage developers to utilize advanced-technology such as facility automation, artificial intelligence (AI) systems, and cloud- managed IT solutions,” it said.