Manila’s office real estate market is predicted among those to perform strongly through 2015, says a report released by global estate consulting firm Cushman & Wakefield (C&W). According to the report, office rental rate in the Philippine capital is poised to grow more than 5 percent through 2015, due largely to solid domestic demand and tight supply.
Sigrid Zialcita, C&W’s Asia-Pacific managing director for research, said that growth in most ASEAN economies is set to return to its potential, and the Asia-Pacific region in particular will continue to be an engine for world economic recovery in 2014. According to her, rental growth rates are expected to accelerate in a number of core and emerging locations led by Tokyo and Manila especially upon the resumption of stronger economic growth over the medium term.
Jakarta is expected to lead the global office real estate market through 2015, with rents on track to increase more than 25 percent, according to C&W. The Indonesian capital is followed by Dublin and Boston, with San Francisco, London, Singapore, Tokyo, Seattle, Manila, and New York rounding up the top 10.
As a whole, the global office market is expected to record steady growth in 2014, with a more robust market in 2015 with continued recovery and renewed confidence in business gains, according to the report.
1. Jakarta
According to C&W, higher supply is expected over the next two years in the Indonesian capital, with absorption, while healthy, will lag with vacancy increasing toward 2015.
2. Dublin
The Irish office market is on its way to recovery, with quality space in demand as companies upgrade or expand their accommodation.
3. Boston
According to C&W, over 3.6 million square feet of class A office space is scheduled to become available 2015, while vacancy rates to remain among the lowest in U.S. CBDs.
4. San Francisco
The city is in the midst of a building boom, with over 2.4 million square feet of new space coming to market until the end of 2015. Demand is also expected to keep pace, resulting in only a slight increase in vacancy.
5. London
Occupier activity is expected to strengthen, while rental values poised to increase amidst a steadily more positive economic scenario.
6. Singapore
Absorption to remain positive due to firm economic and property fundamentals, while tightening vacancies and limited supply to allow moderate increases in rents.
7. Tokyo
Demand for office space in the Japanese capital is set to grow gradually following much-anticipated economic recovery.
8. Seattle
Seattle’s market is recovering nicely from its 2009 downturn, while vacancy is forecast to decrease only slightly due to 1 million square feet coming online in 2015.
9. Manila
Demand is set to grow gradually on the back of strong demand from BPOs. Vacancy rates are anticipated to trend downward over the next 4 years, helped by a moderate level of new constructions, and rents are expected to rise.
10. New York
Improvement in net absorption coupled with substantial new space being delivered over the next two years (which is 48 percent pre-leased) supports continued rent growth. Despite influx of new space, Manhattan’s vacancy rate will remain among the lowest in the United States.
