Manila office vacancy seen easing to 19.6% — CBRE

THE OFFICE vacancy rate in Metro Manila is forecast to ease slightly to 19.6% by yearend, with Ortigas Center standing out due to its steady decline over the past three to four quarters, according to property consultancy CBRE.

“There is a slight improvement with the overall vacancy in Metro Manila to about 20.3%, and for the rest of the year we’re forecasting a slight improvement towards the latter part and early part of next year,” the CBRE team said during its 2025 Retrospective event last week.

CBRE expects Metro Manila’s vacancy rate to decline to about 19.6% this year from the 20.3% recorded in the fourth quarter of 2025.

Its data showed that the Bay Area sub-district continued to post the highest vacancy rate in the fourth quarter, largely due to concentrations of vacated Philippine offshore gaming operator (POGO) spaces. This was followed by Alabang at about 29.6% and Quezon City at around 26%, where much of the recent new completions are located.

With POGOs largely gone, the report noted that newly vacated spaces fell to just 15,300 square meters (sq.m.) in the fourth quarter.

Ortigas Center’s office vacancy rate was estimated at about 13.3%, reflecting a steady drop over the past three to four quarters. CBRE said this could breach single-digit levels by the latter half of 2026.

Meanwhile, demand remained strong in the first three quarters of 2025, although fourth-quarter demand slipped to about 165,000 sq.m.

Despite this, total absorption for the year reached around 854,600 sq.m., the strongest in the past five years.

“Demand improves by 8% year on year, even with a lackluster fourth quarter,” it noted.

The transaction share of the information technology and business process management (IT-BPM) sector fell to 28% in 2025, the lowest in five years, as traditional sectors drove demand and reduced average deal sizes to 1,262 sq.m.

Data showed that 71% of all transactions occurred in Metro Manila, with 68% concentrated in buildings owned by major developers.

Cebu emerged as a key growth driver, with absorption doubling to 128,500 sq.m. in 2025 from 61,000 sq.m. in 2024. Metro Manila and other provincial markets posted declines in uptake.

Metro Manila currently has a total available office supply of about 1.86 million sq.m., consisting of both new and vacated space. Newly completed and unleased space accounts for 44% of the total, while the remaining 56% consists of vacated space.

Makati and Fort Bonifacio hold the largest volumes of available vacated office space, much of which is in buildings developed by smaller or boutique developers.

Meanwhile, most available spaces in Alabang and Quezon City are in projects by major developers. — Alexandria Grace C. Magno