Cebu office vacancy rate drops by 12%
Office rental demand in Cebu has improved from 20 percent vacancy rate 12 months ago to current's 12 percent.
This development, according to economist Claro DG Cordero Jr., of the Jones Lang de LaSalle Philippines is a concrete testament that Cebu continues to be the center of interest among expanding companies, or big outsourcing firms operating in the Philippines.
Corporate operations and Business Process Outsourcing (BPO)dominate the demand for office rentals in Cebu, thus providing good prospects for developers of building office facilities, specifically in cyber parks and PEZA zones.
Unlike in Metro Manila where there is a surplus of rental office facilities due to over building, Cordero said Cebu on the other hand managed to keep the balance, thus rental costs have always been based on real market value.
"Cebu is a resilient market. Developers planned according to what the market only can absorbed," he added.
In fact, there are multinational companies that are already bypassing Metro Manila for their Philippine expansion and chose Cebu instead due to reasonable cost of doing business here, including lesser labor cost, affordable office rental or real estate rates, among others.
Cordero hinted that despite the construction of more medium to high rise commercial buildings, Cebu is far from over supply level in terms of office space availability.
At present, record shows that there is more or less 870 thousand square meters of vacant office space facilities in Cebu. This on the other hand, will be easily disposed due to the strong demand.
Even if this number of office space portfolio will rise in number in the next few months, this is still viable as Cebu is bound to experience its best in terms of economic growth after the Mactan InternationalAirport (MCIA) Terminal 2 will be opened.
Cordero said that the opening of the MCIA terminal 2 will bring unimaginable economic boost for Cebu as foreign investors and local capitalists alike are closely watching this development.