A NEW prime location for business is slowly emerging in the country’s Bay Area where office rental rates rose 18.3 percent in the second quarter of the year.
The KMC Mag Group reported on Monday that the year-on-year rise brought the rental rates to P655.1 per square meter per month. The real estate brokerage is an associate of the London-based real estate services provider Savills.
This was the highest growth in office rental rates posted among the prime office markets in the country.
Top business district Bonifacio Global City wasn’t far behind with the average monthly rentals up 6.8 percent to P855.00 per sqm.
Office spaces in the Central Business District of Makati increased by a modest 2.6 percent, but still the most expensive at P958.6 per sqm. per month.
Other business districts in the report include Ortigas which rose by 3.7 percent at P588.3 per sqm. a month. The Quezon City Business District saw rates go up 7.8 percent. In Alabang, office rentals registered a marginal rise of 0.2 percent at P602.4 per sqm.
Besides having the highest office rental growth rate, the bay area also received the lowest vacancy rate among all the business districts at 0.5 percent in the second quarter.
However, the report noted that “vacancies in the Bay Area are likely to rise in the next three quarters as a result of the turnover of a total of 120,000 sqm. of new office space in the emerging business district.”
The Alabang Business District registered a vacancy rate of 14.1 percent, as demand was overcome by the need to locate in more accessible and commuter-friendly business districts.
Makati has a vacancy rate of 3.8 percent, Ortigas with 3.5 percent, Bonifacio Global City with 1.3 percent and Quezon City with 1.0 percent.
Although the vacancy rate in the Bay Area is expected to rise in the next three quarters, the report noted that several planned office developments such as the two other E-Com towers by the SM Group and the Aseana Three and Four office towers in the 4.5-hectare DoubleDragon Meridian Plaza will keep the construction activity in the Bay Area strong beyond 2016.