CBRE sees 185K sqm in 2015, on top of 376K sqm additional retail space in years ahead
The Philippine property market will continue to expand in the coming months on sustained growth in consumer spending, with new projects expected to deliver 185,000 square meters of additional retail space to the market within the year, real estate consultancy firm CBRE Philippines said in a report.
CBRE Phils, a unit of the global commercial property and real estate services adviser CBRE Group, said that is apart from the 376,000 square meters of retail space yet on the drawing board and to be constructed in the coming years.
Retail space refers to real estate used exclusively to market and sell consumer goods and services. These include shopping centers and individual stores to supermarkets, dry-cleaners, cafes, florists, pharmacies, and the likes, it said.
The CBRE report said robust household consumption continues to bode well for the retail sector in the second half of the year, further sustaining the interest of major retail players.
Several foreign brands are seen entering the local retail market and expanding in new mall developments in the second quarter.
One of the new recent entrants into the Philippine market was Applebee’s, an American family dining chain also known as the world’s largest casual restaurant chain.
The Indonesian convenience store Alfamart, meanwhile, announced it will set up 100 to 120 new stores in the country.
Explaining the source of growth, the CBRE report said retail spending gets a big boost from rising remittances from overseas Filipino workers (OFWs) and the vibrant business process outsourcing (BPO) sector.
The CBRE said it expects stable growth in consumer spending in the country.
The report also said retail rents will be relatively stable across Metro Manila and that the upcoming supply of retail space is seen having minimal effect on the vacancy rates as well as rental rates.
The proliferation of local and foreign retailers entices developers to construct more retail complexes, the CBRE report said.
Demand for retail space will also be coming from “continuous expansions of the current brands and new entrants from both fashion and fast food, fueled by growing market consumption,” the report added.