Part 1 of this article focused on the Philippines’ leading office space providers: SM Prime Holdings, Ayala Land, Robinsons Land Corporation, Federal Land, Inc., Megaworld Corporation, and Filinvest Development Corporation. These real estate giants significantly impact the country’s office landscape by offering a comprehensive selection of workspaces tailored to the needs of businesses from various industries and sizes.
The Future of the Philippine Office Market
The Philippine office market is at a crossroads, navigating the evolving demands of the post-pandemic workplace. Here, we explore potential trends that will likely shape its future:
A. The Rise of Hybrid Work Models
The pandemic’s influence on work arrangements will likely lead to a sustained demand for hybrid work models. This approach, combining remote work with occasional in-office days, requires flexible office spaces that cater to collaboration, focused work, and employee well-being.
Impact on Demand: We may see a shift in demand from large, traditional office spaces to smaller, more collaborative work environments. Co-working spaces and flexible office solutions offered by established landlords like Ayala Land (iWork) or Megaworld (Workshed) could see increased popularity.
B. Co-working Spaces: A Growing Niche
Co-working spaces will likely continue their growth trajectory, particularly for startups and small businesses seeking a cost-effective and flexible solution. These spaces offer a dynamic work environment, and networking opportunities, and eliminate the burden of managing building maintenance.
Impact on Demand: Co-working spaces might expand beyond traditional business districts, catering to suburban locations and regional hubs. This aligns with the development strategies of some landlords, like Cebu Landmasters, Inc., focusing on integrated townships outside Metro Manila.
C. Emphasis on Employee Experience:
The focus will likely shift towards creating office spaces that prioritize the employee experience. This includes features like improved air quality, access to natural light, green spaces, and on-site amenities that promote health and well-being.
Impact on Demand: Landlords and developers might prioritize incorporating these features in their upcoming projects. Examples include Net Lima Estate Holdings, Inc.’s Net Park Five building, with its focus on sustainability and employee well-being.
Notable Office Towers and Ownership: Part 2 – Beyond the Big Players
Finding the right office space is crucial for any business in the Philippines. With the office space market booming, several prominent players have emerged as major landlords.
| Shang Properties | The Enterprise Towers, Ayala Avenue corner Paseo de Roxas. Makati City |
| First Philippine Holdings Corporation (Rockwell Land) | 1 Proscenium, Rockwell Center, Makati |
| Arthaland | Arthaland Century Pacific Tower, Fort Bonifacio Global City, Taguig |
| Century Properties | Century Spire, Century City, Kalayaan Avenue, Makati |
| Daiichi Properties | The Finance Centre, Fort Bonifacio Global City, Taguig |
| Amberland Corporation | One Corporate Center, Brgy. San Antonio, Pasig |
7. Shang Properties
Established in 1987, Shang Properties has been a major player in the Philippine property development scene for over three decades. Their core business areas encompass office and retail leasing, hospitality, and residential development. This diversified portfolio allows them to cater to a wide range of needs within the real estate industry.
There was good news for Shang Properties in 2023, as their leasing and hospitality businesses bounced back after the pandemic. Restrictions eased and vaccination rates went up, leading to more people going to offices, malls, and hotels. This resulted in a 17% increase in leasing revenue, which reached P2.54 billion and made up 26% of the company’s total income.
Shangri-La Plaza Mall did particularly well, reaching its pre-pandemic net income level. The mall’s occupancy rate climbed to 92%, with new stores opening and lease rates increasing thanks to better sales. The Enterprise Center, a prominent two-tower office building co-owned by Shang Properties in Legaspi Village, Makati, also saw a strong recovery, with companies returning to their offices. This office space alone generated P904.1 million in revenue in 2023. The hotel sector is also expected to keep doing well as the market improves.
8. First Philippine Holdings Corporation
First Philippine Holdings Corporation’s (FPHC) Rockwell Land is branching out beyond Metro Manila to capture the growth happening in other cities like Mactan, Bacolod City, Angeles City, Batangas, and Bulacan. Their P16 billion investment in new projects underscores their aggressive expansion plans. This includes a joint venture in Cebu City and a new development in Laguna. This expansion is evidenced by their P16 billion investment in new projects, including a joint venture in Cebu City and a new development in Laguna. While expanding, they haven’t neglected existing projects. Their industrial park arm, First Philippine Industrial Park (FPIP), is also thriving, welcoming new locators and closing deals throughout the year. Currently, FPIP boasts 18.5 hectares of ready-built factories, with 14.8 hectares already leased out.
Rockwell Land’s net income jumped by 30.8%, reaching P3.4 billion. This impressive growth was mainly because their commercial areas performed exceptionally well, hitting record highs. Office spaces continued to perform well, remaining stable, while their retail sector benefited from a surge in spending and the completion of more construction projects. Overall, Rockwell Land’s revenue increased by 12.1% to P18.5 billion. They also achieved higher sales bookings for residential properties and completed more projects compared to 2022. They completed Arton West, a unique development with 80% open space, and East Bay Fordham, the first residential tower built by Rockwell Primaries East Bay.
9. Arthaland Corporation
Arthaland Corporation (ALCO) focuses on developing premium, enduring, eco-friendly properties while working on independent and joint venture projects. One of their key projects is the Arthaland Century Pacific Tower (ACPT), a multi-awarded office building boasting LEED Platinum and BERDE 5-star certifications. Located in the prestigious E-Square at Fort BGC district, near the Shangri-La at the Fort and Philippine Stock Exchange, ACPT was designed by SOM New York, the architects behind iconic structures like One World Trade Center. Arthaland Century Pacific Tower (ACPT) is the world’s first net zero carbon project certified under the EDGE green building rating system.
Arthaland Corporation (ALCO) cemented its presence in Cebu City with Cebu Exchange, its largest office development to date. This impressive 38-story building boasts nearly 90,000 sqm of prime office space and caters to a diverse range of businesses. The design offers flexibility with three distinct zones: a lower zone featuring expansive floorplates (5,900 sqm) ideal for large BPOs, a middle zone with medium-sized spaces (3,400 sqm) suitable for conventional offices and smaller BPOs, and a high zone with more compact areas (2,200 sqm) perfect for startups. To maximize returns, ALCO strategically converted a significant portion of the building into investment properties in 2022 (8,059 sqm office space, 2,628 sqm retail space, 36 parking slots) and continued this strategy in 2023 with an additional 5,316 sqm of office space designated for leasing.
Arthaland is on the verge of achieving its remarkable goal of multiplying its development portfolio by five times by 2024. Since 2019, the company has completed two major projects and secured new properties, accumulating a significant gross floor area of 456,000 square meters. This expansion extends beyond Bonifacio Global City, reaching high-growth areas like Metro Cebu and Metro Laguna with projects like Cebu Exchange, Lucima, and Sevina Park. Arthaland has also established a presence in the well-developed central business districts of Makati and Taguig with Eluria and Savya Financial Center. Sustainability remains a core principle for Arthaland, with each project adhering to the highest ecological standards.
10. Century Properties
Century Properties Group, Inc. (CPGI), a leading Philippine real estate developer since 1986, has grown from a marketing company to a condominiums, houses, offices, and retail spaces developer. The company manages a diverse portfolio through subsidiaries like Century City Development Corporation (known for Century City in Makati) and PHirst Park Homes (affordable housing).
Century Properties boasts a portfolio of modern high-quality office spaces catering to various businesses. Through its subsidiaries – Century Properties manages 145,021 sqm of GLA across its five commercial leasing projects as of December 31, 2023. This includes Century City Mall, Centuria Medical Makati, Asian Century Center, Century Diamond Tower, and Novotel Suites Manila.
CPGI recorded consolidated revenues of P9.7 billion in the first nine months of 2023 (9M 2023), up 10% from P8.7 billion in the same period last year (9M 2022). CPGI’s in-city vertical developments and commercial leasing segments contributed 30%, or P2.9 billion, and 10%, or P1 billion, respectively. The company’s earnings before interest, taxes, depreciation, and amortization (EBITDA) for 9M 2023 surged 30% to P2.5 billion from P1.9 billion in the same period last year. CPGI’s net income after tax for 9M 2023 reached P1.3 billion, a 13% growth from P1.1 billion in 9M 2022.
11. Daiichi Properties
With over 30 years of experience, Daiichi Properties is a leading Philippine developer known for its commitment to sustainability and functionality. They’ve built a portfolio of ten developments exceeding 273,000 square meters of Grade A office space, some with LEED Gold and WELL certifications. Additionally, they’ve acquired and developed over 650 hectares of industrial land, serving more than 500 clients over the past three decades.
Leveraging their focus on sustainability and functionality, Daiichi Properties offers a range of commercial and office spaces, including The Finance Centre, World Plaza, One World Place, 56 Central, One Global Place, The Orient Square, and The Taipan Place. These locations cater to the financial and business sectors, targeting banks, insurance companies, and other professional firms. All their Grade A office spaces are designed to be high-quality and meet the needs of modern businesses. This may include open floor plans for collaboration, energy-efficient lighting, HVAC systems, and even modern amenities like fitness centers, on-site cafeterias, and co-working areas, depending on the specific building. Additionally, some of their office spaces boast LEED Gold and WELL certifications, signifying a commitment to environmentally sustainable construction and the health and well-being of building occupants.
12. Amberland Corporation
Established in the late 1980s, Amberland Corporation has become a prominent name in Philippine property development. They were among the first to introduce residential condominiums within the Ortigas Center, catering to entrepreneurs and professionals with stylish and affordable living spaces. Their portfolio boasts successful projects like Amberland Plaza, The Parc Royale, and the ultra-modern One Corporate Center.
One Corporate Center itself is a testament to Amberland’s architectural prowess. This 54-story masterpiece offers a generous 62,670 sqm of gross leasable office space. Tenants are treated to breathtaking panoramic views encompassing the bustling Ortigas Center, the suburban communities of Marikina Valley, and the scenic backdrop of Antipolo hillsides and Laguna de Bay. Another noteworthy development is the 54-story One San Miguel Avenue, a custom-built haven designed to meet the fast-paced demands of modern businesses. Meanwhile, the strategically located Prestige Tower offers prime accessibility to key commercial and business centers, further enhanced by its proximity to major thoroughfares and prestigious establishments.
Beyond the Checklist: Valuable Insights
Market Trends
- Hybrid Work Models: The rise of hybrid work necessitates flexible office spaces conducive to collaboration and occasional in-office days.
- Co-working Spaces: Explore co-working spaces as a cost-effective and flexible option for startups and small businesses.
- Employee Experience: Prioritize features that enhance the employee experience, such as good ventilation, natural light, well-maintained facilities, and access to green spaces.
Upcoming Developments
Stay informed about upcoming construction projects by major developers that might impact the office space landscape in your preferred location.
Negotiation Tips
- Be Prepared: Do your research on rental rates and comparable spaces before entering negotiations with the landlord.
- Focus on Value: Negotiate not just on base rent, but also on concessions like fit-out allowances or free parking spaces.
- Maintain a Professional Relationship: Negotiate assertively but professionally to build a positive rapport with the landlord.
A dynamic roster of developers contributes to the Philippines’ flourishing office space landscape. These include established names like Shang Properties, Rockwell Land, Arthaland, Century Properties, Daiichi Properties, and Amberland Corporation. Each player brings unique expertise and perspective to the market, offering a diverse range of office solutions. This variety caters to the specific needs and budgets of businesses, ensuring a well-rounded office space ecosystem that can accommodate various industries and company sizes. The presence of these prominent developers is crucial, as they provide a robust foundation for business growth and expansion within the Philippines.
Finding the perfect office space requires careful planning and a comprehensive evaluation process. By considering your company’s needs, utilizing this checklist, and leveraging the valuable insights provided, you’ll be well-equipped to navigate the Philippine office space market and secure a space that fosters your business growth and empowers your employees.
