Lamudi’s 3Q19 Metro Manila Real Estate Market Overview in Partnership with JLL

Table of Contents

  1. JLL Reports Positive Turn in Philippine Economy for 3Q19
    1. Office
    2. Figure 1. Annual Office Supply (2015-2022E)
    3. Figure 2. Office Lease Transactions (3Q19)
    4. Residential
    5. Figure 3. Annual Residential Condominium Supply (2015-2022E)
    6. Retail
    7. Figure 4. Annual Retail or Shopping Centres Supply (2015-2022E)
    8. Hotel
    9. Figure 5. Annual Hotel Room Supply (2015-2022E)
  2. Property Seeker Behavior on Lamudi in 3Q19
    1. Figure 6. Leads Generated Per Property Type (3Q19)
    2. Luzon
    3. Figure 7. Leads Generated in Luzon (3Q19)
    4. Visayas
    5. Figure 8. Leads Generated in Visayas (3Q19)
    6. Mindanao
    7. Figure 9. Leads Generated in Mindanao (3Q19)
    8. Overseas
    9. Figure 10. Leads Generated from Overseas (3Q19)

With BPO, POGO, tourism, and other drivers contributing to the uptake of real estate properties in the Philippines, the country has experienced favorable investment conditions in the third quarter of 2019. Metro Manila, the most popular place for real estate investments in the country, continues to hold the majority of supply, but the country’s overall stable economic performance  and the growing investor appetite from different regions can lead to an outpour of investments in the outskirts of Manila, and perhaps even outside of Luzon, in 2020. 

In this report, JLL outlines the drivers of growth in the metro for the third quarter of 2019, highlighting the ease in inflation as well as the changes in the residential, office, retail, and hotel sectors. Lamudi also details the sustained interest in property investments of property seekers, who are particularly interested in house and land for sale, and apartments and condominiums for rent. 

JLL Reports Positive Turn in Philippine Economy for 3Q19

The Metro Manila real estate market exhibited stable performance through sustained demand despite facing headwinds. On the other hand, outlook remains upbeat, pushed by positive market sentiment from key stakeholders and continued property development across Metro Manila.

In terms of the greater Philippine economy, gross domestic product (GDP) grew by 6.2% y-o-y in 3Q19, after missing growth targets in the 5.5% average growth in the first half of 2019. Compared with other regional economies that have already released their GDP figures, the Philippines trails behind Vietnam’s 7.3% growth and goes ahead of China and India’s 6%, and Indonesia’s 5% growth. According to the Philippine Statistic Authority, services recorded 6.9% growth, followed by industry and agriculture with 5.6% and 3.1%, respectively. Real estate, renting, and business activities improved by 4.2% y-o-y in 3Q19, making up 20.3% of the total service sector and 12.1% of the total 3Q19 GDP. Other subsectors with notable growth is construction under the industry sector with 16.3% y-o-y, and financial intermediation under the services sector with 10% growth y-o-y.

Inflation rate posted 0.8% in October 2019, opposite the peak in 2018 when inflation jumped to 6.7%. Improved weather conditions, rice tarrification, and restrained oil prices pulled down headline inflation. Due to the consecutive easing of inflation, the Bangko Sentral ng Pilipinas (BSP) decided to cut interest rates on overnight reverse repurchase (RRP) facility by 50 basis points through 3Q19, setting from 4.5% in June 2019 to 4.0% in September 2019. The Philippines also maintained a stable exchange rate versus the US dollar, averaging of PHP 52.11 to a US dollar for the month of September 2019.

Overall, after missing growth targets, as well as facing peak inflation rate, in the past periods, the Philippines economy saw positive turns in 3Q19.


In 3Q19, the office property market maintained growth through new supply completions and sustained stable demand despite headwinds in primary drivers. Around 403,500 sqm of office spaces were added in 3Q19 coming from Taguig City, Quezon City, and Mandaluyong City. Approximately 526,200 sqm more is slated to be added to the total office stock in 4Q19E, mainly from Pasig City, and Quezon City.

Figure 1. Annual Office Supply (2015-2022E)

Note: Supply includes Prime, Grade ‘A’ and Grade ‘B’ office buildings in Metro Manila.
Source: Various developers; JLL Research and Consultancy

Average vacancy rate in Metro Manila posted at 8.0% in 3Q19, up from the recorded 6.6% of vacancy in 2Q19, attributed to the sizeable new supply completed through 2019. Meanwhile, take-up remained stable as demand faced issues surrounding tax reforms, crackdown on online gaming operators, and the sustainability of flexible space operators, following the failed IPO of New York-based WeWork.

Despite the uncertainties and issues, leasing activity remained to be mainly driven by the demand from Offshoring and Outsourcing (O&O) firms which accounted for 53% of the total leasing transactions in 3Q19. O&O firms remained to bank on the large English-speaking population and highly skilled talent in IT-related jobs found in the Philippines. Meanwhile, Philippine Offshore Gaming Operators made up 27% of the completed deals in the same quarter. The industry stays intact with the government’s initiative to further strengthen the framework through cracking down on illegal operations. Flexible space operators also made up a notable portion of the leasing activity, undeterred by the WeWork story. WeWork in the Philippines, remained status quo and expanded its initial set of hubs in three separate sites in Bonifacio Global City, Taguig City. Other major players, such as KMC Solutions and DTSI are seen to expand in other key business districts, such as Muntinlupa City, and Quezon City, among others.

Figure 2. Office Lease Transactions (3Q19)

Notes: (1) Percent calculated by area leased in transactions completed in 3Q19. (2) Includes recorded JLL and non -JLL Transactions.
Source: JLL Commercial Leasing; JLL Research and Consultancy

The sustained demand in the office sector is seen to support stable growth of rents. Makati City and Taguig City command the highest asking monthly rental rate due to the presence of premium quality buildings, accessibility, and existing headquarters of major players from their respective industries mainly located in Makati CBD and BGC. Business hubs in Bay City within Pasay City and Parañaque City are also seeing higher asking rental rates pushed by the robust demand from POGOs and other interest from mainland Chinese businesses.


The residential condominium market in Metro Manila sees stability with continuous development launches and supply completions. About 6,100 units were added to the total residential stock in 3Q19, mostly coming from residential projects completed in the emerging townships in Quezon City, such as Cloverleaf and Vertis North, as well as Circuit Market, in Makati City. Around 28,800 units are expected to be completed within the rest of 2019, notably in Quezon City, Taguig City, and Pasay City. The sales market sustained strong interest from high net-worth individuals and investors, as overall sales rate in Metro Manila posted 95.9% as of 3Q19. In terms of the rental market, corporate housing for expatriate employees continue to drive the upper-mid to luxury development within Makati CBD, BGC, and Ortigas CBD where MNCs, O&O firms, embassies, and consulates are typically headquartered. Staff housing for POGOs also support the strong leasing demand in Bay City, spreading towards other areas such as Quezon City and Muntinlupa City due to emergence of presence in these areas. Local employees and students also make up a portion of the leasing demand as they opt to reside in half-way homes near their workplaces and schools, respectively.

Figure 3. Annual Residential Condominium Supply (2015-2022E)

Note: Covers mid-range to luxury residential condominium developments
Source: JLL Research and Consultancy


The retail property market grew with expansions and launches of new developments across Metro Manila. The completion of Ayala Malls Manila Bay added around 160,000 sqm GLA while the expansion in Robinsons Magnolia added another 15,000 sqm GLA to the total stock in 3Q19. For the rest of 2019, Ayala Malls Palmina, a 15,000-sqm GLA mall is expected to open in Novaliches, Quezon City. Deca Mall by 8990 Holdings, Inc. and the Estancia Expansion by Ortigas & Co. are set to open in Manila City with 18,000 sqm GLA and in Pasig City with 65,000 sqm GLA, respectively. The strong take-up by F&B brands supports the leasing activity in retail spaces, helping maintain a healthy vacancy rate of 2.5% in 3Q19. F&B brands such as Zark’s, Banh Mi Kitchen, and Peri-Peri Charcoal Chicken opened in Robinsons Galleria, while % Arabica, Elephant Grounds, Maragume Udon, Nanyang, and New Bombay opened in The Podium. Aside from F&B, cosmetic and skin care are also driving take up of retail spaces. Shiseido, a popular Japanese brand, forms a joint venture with Luxasia to expand its range of product offerings. MizuMi, a Thai dermacare brand, launched and started selling their products in 3Q19. The F&B industry is likely to continue as the top retail demand driver with new entrants such as Panda Express and Crystal Jade restaurants. Lastly, Shake Shack is set to open its second branch in SM Megamall by end-2019.

Figure 4. Annual Retail or Shopping Centres Supply (2015-2022E)

Source: JLL Research and Consultancy


The hospitality sector expanded in 3Q19, driven by the rise in hotel investments and tourist arrivals. About 580 rooms were added to the total stock during 3Q19, coming from Sheraton Manila Bay by Alliance Global Inc. in Manila City, Summit Hotel Greenhills by  Robinsons Land Corporation in San Juan City, and Park Inn by Radisson – North EDSA by SM Prime Holdings in Quezon City. The rest of 2019 is expected to see the completion of nine more hotel and serviced apartment projects with at least a total of 2,000 rooms in Metro Manila, primarily in Makati City and Bay City. Beyond 2019, supply is seen to increase with the growth of the upscale market with new entrants renovating and managing old developments. For example, Marriot will convert Pan Pacific Manila into Sheraton Manila Bay and Resorts World Manila’s Maxims Hotel into The Ritz-Carlton. The hotel market also anticipates the expansion of budget chains such as RedDoorz and OYO in key areas.

Figure 5. Annual Hotel Room Supply (2015-2022E)

Note: Covers economy to luxury hotel developments
Source: JLL Research and Consultancy

Apart from the typical demand drivers of MICE, the local ‘staycation’ phenomenon, and casino patrons in Bay Area, the hotel market saw the rise of POGO employees as long-staying guests, notably in Pasig City, Mandaluyong City, and Muntinlupa City. The strong demand accommodation has spilled over to hotels due to the limited residential options in the said areas.

Overall, the Metro Manila property market remained stable across all sectors as seen in the sustained growth spurred by their respective demand drivers. Despite issues on PEZA and the moratorium and crackdown on POGOs, the office market remains to have stable leasing activity from IT-BPM and online gaming firms. At the same time, foreign and local buyers of residential projects continue to have positive investment sentiment banking on the development of key areas in Metro Manila. The retail market saw growth with the entry and expansion of both local and foreign brands in F&B and emerging operators. The large new supply completed so far in 2019 may have entered the market at the same time as when the headwinds popped up, but the current developments on policies, infrastructure, and investment direction from both local and foreign source pave way for sustained growth moving forward. 

Property Seeker Behavior on Lamudi in 3Q19

The 25-34-year-old age group dominates activity on the Lamudi platform, generating leads almost as much as the sum of leads from all other age groups combined. The second-most prolific searchers are in the 35-44 age group. Overall figures show that females contribute to 62% of total real estate searches. 

Figure 6. Leads Generated Per Property Type (3Q19)

Source: Lamudi

Looking at Philippine real estate as a whole, houses account for most for-sale inquiries, generating 33.78% of leads. In terms of rentals, apartments rank first, with 42% of all rental inquiries. Condominiums for rent also contribute to 34.98% of leads, showing the diversified interest in real estate investments all over the country. 


Most of property inquiries still come from the 25-34-year-old age group, followed by the 35-44 age group, but in Luzon, even the younger age group of 18-24 show a strong interest in real estate. The age group accounted for 13% of searches coming from Luzon. Interestingly, in this region, despite having fewer pageviews, rental properties dominate over properties for rent in terms of leads at 62%.

Figure 7. Leads Generated in Luzon (3Q19)

Source: Lamudi

Overall, condominiums get the most leads, but houses (33.02%) are the most popular for sale, followed closely by land (32.16%). Apartments are the most popular for rent, accounting for 41.78% of inquiries, followed by condominiums (35.81%). Property interest is strong coming from Metro Manila residents, particularly from Quezon City, Makati, City of Manila, Pasig, Paranaque, Las Pinas, and Taguig. CALABARZON residents from Bacoor and Antipolo also show strong interest in real estate. Baguio, from the Cordillera Administrative Region, is also showing interest in Philippine real estate in Luzon. 


The age group 25-34 also dominates in the Visayan region, accounting for 46% of searches. Females also have a strong lead, contributing to 61% of all searches. In Visayas, properties for sale and for rent almost get an equal number of views, but inquiries for rentals are almost double that of properties for sale.

Figure 8. Leads Generated in Visayas (3Q19)

Source: Lamudi

In terms of properties for sale, house and land garnered the most leads, at 30.90% and 37.13%, respectively. For rental properties, 49.91% of inquiries were for apartments. The majority of inquiries come from residents of Cebu City, Bacolod, Iloilo City, Lapu-lapu City, Dumaguete City, Tacloban City, and City of Naga. Cebu City residents accounted for more than 87% of all searches in Visayas. 


The majority of property seekers in Mindanao also belong to the 25-34 age group, followed by the 18-24 and 35-44 age group. Females account for 56% of searches, while males make up the remaining 44%.

Figure 9. Leads Generated in Mindanao (3Q19)

Source: Lamudi

Choosing between properties for sale or for rent, Mindanao residents seem to be more interested in rentals, particularly, apartments for rent, which comprise 54.87% of rental inquiries. Condominiums come in second, earning 20.41% of leads. For properties for sale, land is the most popular at 44.85%, followed by house at 34.19%. The majority of Mindanao property seekers come from Davao City, Cagayan de Oro, General Santos, Iligan City, Butuan City, Zamboanga, Ozamiz City, and Cotabato City.


Overseas interest in Philippine real estate follows the same demographic distribution of interest from Philippine residents. However, there is a smaller gap between male and female seekers, with females having just a slight edge. In terms of property type, the interest in properties for sale is almost double that of properties for rent.

Figure 10. Leads Generated from Overseas (3Q19)

Source: Lamudi

House, land, and condominium for sale are the three most popular property types, at 37.32%, 32.01%, and 21.07%, respectively. Looking at properties for rent shows interest shift to apartments, condominiums, and houses, with 36.07%, 38.25%, and 16.32%, respectively. Real estate interest comes from Dubai, Doha, Sydney, Los Angeles, London, New York, Riyadh, Abu Dhabi, Melbourne, and Chicago, areas outside the Philippines that have a significant number of Overseas Filipino Workers (OFWs). 

The state of Philippine real estate this quarter points to an upward trajectory of investments should an investor choose their property wisely. Consider the region and the availability of stock, as well as the demand from local and overseas property seekers. Investing in Philippine real estate can provide a good return on investment in the long run, as long as the country continues to develop properties in line with commercial and residential demand.


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