Property market fundamentals remain intact — Leechiu

THE Philippine property market has remained resilient despite major disruptions since 2019, although the ongoing Middle East conflict could pose the biggest risk so far, according to Leechiu Property Consultants.

“Despite the cumulative pressure, the structural foundations of the market remain intact. The fundamentals that supported 2019, the last clean year for Philippine real estate, are still in place. They are simply harder to see beneath six layers of disruption,” Leechiu Property Consultants said in an analysis posted on its website.

The firm warned that the crisis could offset recent monetary easing as gasoline and diesel prices increased by 63% and 146%, respectively.

Leechiu said the Bangko Sentral ng Pilipinas (BSP) raised its benchmark interest rate to 4.5% amid renewed inflation concerns despite cumulative rate cuts totaling 225 basis points since August 2024.

“For the first time in over two years, the central bank raised its benchmark interest rate by 25 basis points to 4.5%, responding to renewed inflationary pressures driven by oil price shocks linked to the Middle East conflict,” the firm said.

The market has faced several disruptions since 2019, including the COVID-19 pandemic, the Russia-Ukraine war and inflation spike in 2022, the ban on Philippine offshore gaming operators (POGOs) in 2024, and tariff increases imposed by US President Donald J. Trump, as well as controversies involving Philippine flood control projects in 2025.

The impact has been reflected in the broader economy, with the Philippine Stock Exchange index (PSEi) down 23% from its 2019 closing level and gross domestic product (GDP) growth slowing to 4.4% in 2025, the weakest since the pandemic.

The industrial and retail sectors outperformed amid the six crises.

Industrial rents have increased by 45% since 2019 and remain the only segment with consistent rent growth across every global disruption, driven by e-commerce, fast-moving consumer goods (FMCG) companies, and the China+1+1 supply chain trend.

Retail revenue increased 7.5% year on year, with three developers posting P61.6 billion in revenue in the first half of 2025. Urban big-box and experiential retail formats are gaining traction, supporting a positive short- and long-term outlook.

“The market is running out of gas, but the engine is sound. The fundamentals that made 2019 a great year are still here, just buried under six layers of crisis. Smart capital positions now,” said Tam Angel, director for investment sales at Leechiu Property Consultants. — Juliana Chloe A. Gonzales