Metro Manila Office Vacancy Holds Near 19 Percent As Second Half Supply Tests Landlords

Metro Manila property landlords face a same-day supply test after office leasing slowed in the second quarter while vacancy stayed near 19 percent.

Local Trigger

Market commentary citing Colliers data said Metro Manila office transactions fell 24 percent quarter on quarter to about 145,000 square metres in Q2 2026, while first-half vacancy held around 19 percent. Roughly 434,000 square metres of second-half completions could keep landlords competitive on rents and incentives.

Market Segment

The pressure is not uniform. Prime CBD towers, PEZA-accredited buildings and transit-oriented locations should be more resilient, while older or secondary assets may need stronger discounts, fit-out help or flexible terms. Residential condo absorption remains linked because office demand supports tenant depth in nearby districts.

Who Is Affected

Landlords with stronger balance sheets can protect occupancy through incentives, while weaker buildings face repricing risk. Tenants gain negotiating room, and condo investors near office clusters should watch whether leasing demand supports rents.

Buyer Checks

Occupiers should compare effective rent after incentives, PEZA eligibility, transport access, fit- out costs, expansion rights and building operating expenses. Investors should separate gross vacancy headlines from occupied space in the exact CBD and building grade.

Outlook

Metro Manila's office market is recovering cautiously, not uniformly. The second-half completion wave will show which locations can defend income and which assets need a pricing reset.

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