In its Philippine Property Market Briefing for the second quarter of 2026, Colliers Philippines said that the property market continues to show signs of resilience, with occupier demand, tourism recovery, affordable housing interest, and modern logistics requirements shaping opportunities for investors, developers, and occupiers.

Kevin Jara, Director and Head of Office Services – Tenant Representation of Colliers Philippines, said the Metro Manila office market remained steady in the second quarter of 2026, with vacancy at 19 percent, unchanged from the previous quarter, and projects the vacancy rate to reach 19.3 percent by the end of 2026 as global uncertainties continue to affect leasing decisions.

“Vacancy actually stayed remarkably flat since 2023, just 19 percent over the last four years,” said Jara. “The market slowed down for the first six months of the year, but it's not contracting. So, it's still going to be a positive take-up by the end of the year.”

The net office take-up reached 91,000 square meters in the first half of the year, slightly lower than 96,000 square meters in 2025, but as leasing activity improves, Jara expects a recovery of 300,000 square meters for the full year.

Metro Manila recorded 335,000 square meters of office transactions in the first half of 2026, down 24 percent year-on-year, with Makati CBD, Fort Bonifacio, and Ortigas fringe leading activity, while outsourcing and shared services accounted for more than a third of total deals.

In the provincial office market, transactions fell to 65,000 sqm. “So, that's down 59 percent from 159,000 in the first six months of 2025. So, in terms of ranking, Iloilo led with 22,000, followed by Cebu at 19,000, and Pampanga at 14,000,” shared Jara.

For the Metro Manila residential condominium market, Joey Bondoc, director and research head of Colliers Philippines, said, “The residential sector had subdued completion due to the Middle East conflict. In fact, the lowest in two decades. Only about 2,500 units were completed in the first half of 2026. But we will be seeing more for the remainder of this year, with nearly 10,000 more units.” Overall, residential vacancy stood at 24.9 percent as of the second quarter this year, heavily influenced by the Bay Area, where vacancy reached 58 percent.

Up until the second quarter of this year, the pre-selling condominium market remained subdued, with 2,600 units launched and 1,700 units sold, down 64 percent and 57 percent year-on-year, respectively.

Bondoc also emphasized the continued strength of the economic and affordable segment, which accounted for 67 percent of total take-up. He also added that Metro Manila has about 80,000 unsold condo units, 32,000 of which are ready-for-occupancy (RFO) units.

In the hotel sector, Bondoc reported that foreign arrivals reached 3.16 million in the first half of 2026, up from 2.9 million a year earlier, while the Department of Tourism targets international arrivals at 6.4 million by the end of the year. Average hotel occupancy stood at 63 percent in the first half of 2026, while 2,490 new hotel rooms are expected to be completed in Metro Manila this year, the highest level in eight years. “That's a pretty good figure and a sizable completion because that represents a 236 percent increase compared to total hotel room completion in 2025. The new hotels that were completed in the first half of 2026 include Alino Hotel in Quezon City, Wyndham Garden Manila Bay, and Somerset Valero in Makati.”

Average daily rates grew by 2.4 percent, with Colliers expecting a 4 percent increase for the full year, supported by tourism recovery, gradual MICE rebound, and the return of high-spending travelers.

For the industrial property market, Bondoc said the average vacancy across CALABA, Central Luzon, and Metro Manila improved to 13.1 percent in the first half of 2026, up from 14.1 percent in the second half of 2025. Average warehouse rents reached P260 per sqm, supported by increasing lease rates for modern warehouses. For the first half of the year, Colliers reported 230 hectares of new industrial supply in Southern and Central Luzon and projects another 190 hectares at the end of the year.