Metro Manila to see largest condominium completion since 2018

Wazzup Pilipinas!?

Bay Area to have largest condo supply as Metro vacancy nearing pandemic peak

Metro Manila will see the turnover of nearly 11,300 condominium units in 2024, the biggest completion since the 11,700 units delivered in 2018, according to data from leading diversified professional services and investment management company Colliers

 From 2024 to 2026, Colliers sees the completion of 8,000 new condominium units in Metro Manila, much less than the nearly 13,000 residential units turned over in the capital region every year from 2017 to 2019. Colliers recorded the delivery of 1,240 units in Q4 2023. This brought total completion in 2023 to 3,540 units, lower than our earlier forecast of 4,920 units due to delay in the completion of some projects, particularly in the Bay Area. Colliers forecasts condominium completion to recover in 2024 with the delivery of 11,290 units, the largest since 2018. According to Joey Roi Bondoc, Colliers Director of Research, the Bay Area will likely account for more than 60% of new supply during the period. “We also expect this submarket to dominate other Metro Manila sub-locations in terms of condominium supply in 2024. By the second half of this year, the Bay Area will have the largest condominium supply across Metro Manila with 44,000 units, even higher than Fort Bonifacio’s total of 43,800 condominium units.”

Lukewarm Metro Manila pre-selling launches and take-up

In 2023, Colliers recorded the take-up of about 23,400 condominium units in the Metro Manila pre-selling market, an improvement from the 21,600 units sold in 2022. The affordable to lower mid-income segments (PHP2.5 million to PHP7 million per unit) dominated in terms of pre-selling condominium demand in Metro Manila, accounting for 57% of total take-up in 2023. Meanwhile, pre-selling condominium launches reached 24,900 units in 2023, down 4% YOY. In our view, developers are becoming more cautious with their new residential launches especially with still sizable number of ready-for-occupancy (RFO) units in Metro Manila with remaining inventory life currently at 3.2 years. 

Vacancy in the secondary market improves

Vacancy in the secondary residential market dropped further to 16.8% as of end-2023 as vacancies across all sublocations improved. Residential leasing in major business hubs, such as Rockwell Center, Fort Bonifacio, Makati CBD, Ortigas Center, and the Bay Area, was mainly driven by returning expatriates from outsourcing, manufacturing, and logistics industries. Some local employees that are starting to return-to-office (RTO) are actively looking for units to rent, taking advantage of rental corrections for studio and one-bedroom units in prime business districts such as Makati CBD, Fort Bonifacio, Bay Area, and Ortigas Center. Vacancy nearing pandemic peak due to sizable completion in 2024

“We project rents and prices to grow albeit at a slower pace starting 2024. We attribute this to still elevated vacancy given the substantial number of RFO units in the secondary market. We see substantial addition to Metro Manila RFOs given the new units to be delivered especially in the Bay Area,” said Bondoc. “Colliers forecasts residential vacancy to increase to 17.7% in 2024, near the record-high vacancy of 17.9% we recorded in 2021. We see vacancy in the Bay Area submarket rising to 28%, an all- time high, partly due to the completion of more than 7,000 new condominium units this year.”

About Colliers

Colliers (NASDAQ, TSX: CIGI) is a leading diversified professional services and investment management company. With operations

in 65 countries, our 19,000 enterprising professionals work collaboratively to provide expert real estate and investment advice to clients. For more than 28 years, our experienced leadership with significant inside ownership has delivered compound annual investment returns of approximately 20% for shareholders. With annual revenues of $4.5 billion and $98 billion of assets under management, Colliers maximizes the potential of property and real assets to accelerate the success of our clients, our investors and our people. 

About "WazzupPilipinas.com"

WazzupPilipinas.com is the fastest growing and most awarded blog and social media community that has transcended beyond online media. It has successfully collaborated with all forms of media namely print, radio and television making it the most diverse multimedia organization. The numerous collaborations with hundreds of brands and organizations as online media partner and brand ambassador makes WazzupPilipinas.com a truly successful advocate of everything about the Philippines, and even more since its support extends further to even international organizations including startups and SMEs that have made our country their second home.