PRIME logs 528,000 square meters of net take-up in 2026 Q3, lifting occupancy to 85 percent while new completion shrink to a fraction of their pre-pandemic pace.
Metro Manila’s office market is absorbing space faster than developers are delivering it. PRIME Philippines’ 2026 Q3 Real Estate Market Briefing recorded 528,000 square meters of net take-up in the third quarter, well above the 289,000 square meters of new supply completed in the same period. Occupancy climbed to 85.0 percent from 83.2 percent in the first half of the year, although it remains one point below the 2025 level.
Occupied office space reached a record 13.4 million square meters, surpassing the 13.3 million square meters recorded in 2024. The rebound comes despite a difficult macroeconomic environment, with inflation at 7.2 percent in September and the Bangko Sentral ng Pilipinas lifting its policy rate to 5.0 percent.
A Thin Pipeline Hands Landlords Leverage
The bigger story lies ahead. Only 154,000 square meters of new office space are scheduled for the fourth quarter of 2026 and 149,000 square meters for 2027. Between 2017 and 2025, Metro Manila added an average of 667,000 square meters a year. With construction costs rising and developers holding back new launches, occupiers who delay decisions may find fewer options and firmer rents.
A Two-Speed Capital
Performance remains uneven across business districts. Bonifacio Global City commands the highest average rent at PHP 1,157 per square meter, up 4.2 percent year on a year. Makati’s average slipped 12.3 percent to PHP 1,008, while Ortigas eased 3.3 percent to PHP 735. Alabang posted the sharpest rent increase at 8.7 percent, to PHP 761, while the Bay Area rose 4.4 percent to PHP 710 even as vacancies there continue to pile up. Quezon City gained 1.4 percent to PHP 720.
Annual New Office Supply, Net Take-Up, and Occupancy in Metro Manila
Average Lease Rates and Year-on-Year Change by Business District, 2026 Q3
CBD Buildings With Confirmed Pending PEZA Application, 2026 Q3
Reopening Metro Manila to PEZA IT Parks
Policy is also turning in the market’s favor. Administrative Order No. 45, signed on July 23, 2026, lifted the seven-year moratorium on new information technology parks and centers in Metro Manila. The exemption covers only IT parks and IT centers, and new developers do not receive fiscal incentives, but it allows qualified building to market themselves as PEZA locations again. PRIME expects higher occupancy in projects with pending applications, including Arca South 1 in Taguig, Yuchengco Centre and Altaire in Makati, Parqal in the Bay Area, and One Trium Tower in Alabang.
Monthly Cost Per Agent
Wages, Not Rent, Decide Where BPOs Grow
PRIME’s cost model shows why outsourcing firms weigh talent and wages above rent. Occupancy costs PHP 2,523 per agent each month in Metro Manila, just 7.5 percent of an agent’s wage. In Cebu and Davao, that share falls to about 6 percent, and the combined cost of wages and occupancy is 8.1 percent lower in areas outside Metro Manila, 10.8 percent lower in Cebu, and 15.7 percent lower in Davao. most of the savings come from wages.
Annual Revenue per FTE by Sector and IT-BPM Revenue Share
The industry’s growth is also shifting toward higher-value work. Information technology (IT) and digital services generate USD 33.3K in annual revenue per full-time employee (FTE), and global capability centers (GCCs) USD 32.3K, compared with USD 20.1K for contact center and business process services. Healthcare services sit in between at USD 22.4K, while game development and animation trail at USD 14.9K and USD 10.1K.
Contact centers still dominate the USD 53.4B industry, accounting for 63.5 percent of revenue. GCCs follow at 16.3 percent, IT digital services at 11.4 percent, and healthcare services at 8.4 percent. The productivity gap has direct implications for office demand. Each dollar of GCC of IT revenue requires roughly 40 percent fewer seats than a dollar earned by a contact center, so growth led by these segments will lift revenue faster tan headcount. The shift is already visible in leasing, with IT-BPM firms accounting for 20.1 percent of Metro Manila office demand in 2026 Q3, up from 16.2 percent a year earlier. PRIME expects the next wave of demand to favor capability over headcount, with landlords competing for fewer but higher-value seats.
“Metro Manila is building a fraction of the offices it used to,” the briefing states. “Tenants who wait will pay more.”
About PRIME Philippines
PRIME Philippines is the country’s fastest growing and most disruptive commercial real estate advisory firm. Established in 2013, PRIME has redefined the brokerage industry by replacing outdated practices with innovation, data intelligence, and relentless execution. With full-service offices in Manila, Cebu, and Davao, PRIME has completed over 300 high-impact projects nationwide. Backed by a team over 100 professionals, PRIME is multi-awarded and trusted by the country’s top developers, investors, and occupiers. It is involved in big ticket office transactions and holds the No. 1 position in industrial leasing nationwide.
REFERENCE: PRIME Philippines