Landlords in the Cebu office market are urged to introduce high quality office buildings in a bid to capture demand from multinational firms, according to a professional services firm.
“Metro Cebu is ripe for shared services and multinational companies as they take advantage of the existing skilled labor and infrastructure. With this, landlords should capture the demand by introducing high quality office buildings in their pipeline,” Colliers Philippines Associate Director for Office Services-Tenant Kevin Jara said.
Colliers believes that Metro Cebu remains as one of the most attractive expansion hubs for outsourcing firms in the Philippines.
Data from Colliers showed that office transactions in Cebu totaled 16,100 square meters in the first quarter of the year, accounting for 55 percent of provincial office space transactions during the period.
“While vacancies remain elevated due to new supply coming online, Colliers believes that expanding outsourcing firms are likely to occupy more office spaces,” it added.
In the first quarter of the year, Colliers recorded the delivery of 41,400 sqm of new office space in Cebu with the completion of Skyrise 3B and Faustina Center in Cebu IT Park (CITP) and Cebu Business Park (CBP) Fringe, respectively.
For this year, Colliers projects the completion of 78,500 sqm of office space in Cebu.
Apart from new supply entering the market, Colliers said some tenants also continue to vacate office spaces, and this is likely to result in slower absorption for the remainder of the year.
“Despite this, Colliers still sees a tenant-leaning market for Cebu and this should provide an opportunity for shared services and multinational companies to take advantage of the province’s labor pool and infrastructure,” Colliers said.
It added that existing occupiers in the country may also want to look into Cebu for their business continuity plans.
Landlords, on the other hand, should remain proactive in chasing major occupants that are on the lookout for expansive and new office spaces as well as sustainable buildings.