Southeast Asia Outlook 2024

Southeast Asia Outlook 2024: Opportunity Beckons

CUSHMAN & WAKEFIELD

MARKET STATISTICS

OFFICE (GRADE A&B)

RETAIL (SHOPPING CENTER)

LOGISTICS (METRO MANILA)

RESIDENTIAL (LUXURY CONDOS)

153.29*

111.76

232.26*

51.10*

Rents Q4 2023 (PHP psf pm) 2024 Forecast

X X X

X

X 15.4%

8.0%*

8.7%

X 6.0%*

Vacancy Q4 2023 2024 Forecast

X

X

Current Inventory (million sf)

102.2

100.3*

1,345.5

31,700 units

Pipeline Supply (million sf)

9.1

1.1

102.3

1,300 units

PHILIPPINES: MANILA MARKET SNAPSHOT

Pipeline supply over Current Inventory Ratio (%)

9.0%

0.03%

5.0%

2.5%

X X X X

Capital Value Outlook 2024

ECONOMY

Source: Cushman & Wakefield Research

*High-end/luxury market

• The Philippine government expects the country’s economic growth to improve in 2024 at a growth rate of 6.5% to 7.5% amidst ongoing strong El Nino and persistent geopolitical and trade tensions affecting the country’s foreign trade relations. • The country’s growth is driven by strong private consumption, the return of inflation to the expected target range of 2.0% to 4.0% and increased demand for Philippine exports as supply chain bottleneck eases. • Overall property demand is expected to improve in 2024, but office vacancy in some markets might be affected by the passing of the amendments to the legislation that will allow for companies to operate under more flexible work arrangements.

RECENT SIGNIFICANT DEALS

PROPERTY NAME

PROPERTY TYPE

Price (mil USD) / US $PSF

NET YIELD (%)

BUYER

SELLER

DATE

The Podium SM Investment Corp

Keppel Land

Mixed

285/ NA

-

Q2 2023

CAPITAL MARKETS ANALYSIS

1. OFFICE: With vacancies remaining high, headline rates in non-CBD areas marginally decline, while headlines rents in the CBD remained unchanged, on average. 2. RETAIL: The increased leisure activities and normalizing business operations are revitalizing the demand for retail space but with more emphasis on experiential shopping experience.

Chemical Industries of the Philippines

3. LOGISTICS: Vacancy rates in Grade A supply remained low, as major developers increased their presence in the segment. 4. RESIDENTIAL: Luxury segment unaffected by demand-side headwinds. Yields remained unchanged as rental rates further increase due to strong recovery of the leasing demand.

Chemphil

Keyland Corporation

Office

20/ NA

-

Q1 2023

Source: RCA, Cushman & Wakefield Research

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