THE office market of Metro Manila is turning increasingly toward “off-center” locations, while the business districts of Cebu are expected to continue to be tight while hitting vacancy lows. These trends forecasted to happen until the end of the year were reported in the latest Year-end 2025 Market Monitor released by real estate services firm CBRE.
First, the National Capital Region is undergoing a significant geographic pivot, with the traditional central business districts (CBDs) now accounting for only 37 percent of the year's pipeline. That the other 62 percent of all upcoming stocks will be situated in the off-center hubs this year signals a major decentralization of the capital’s commercial landscape.
The report identifies a total of 470,000 sqm of new office space slated for completion in 2026. Leading the surge in off-center development is Arca South, which dominates the pipeline with 94,100 sqm of upcoming space across projects like Bamberton Place, Tryne Enterprise Plaza, and Arca South Corporate Center 1 and 2.
Other key growth areas identified in the report include Buendia Corridor with 83,700 sqm by The Yuchengco Center; Bay Area with 76,000 sqm from Southfield, One Pacific by the Bay, and Double Dragon Meridian; and Quezon City with 55,700 sqm from SM North Tower 5 and Parklinks.
While the momentum is shifting outward, established hubs continue to see high-quality completions. Ortigas is set to add 47,000 sqm from The Galleon Tower 1, while the Bonifacio Global City (BGC) will see 46,000 sqm from Pioneer House BGC and W Sixth. Meanwhile, the City of Manila and Northgate Alabang are contributing a combined 67,400 sqm to the 2026 total.
The decentralization trend appears to continue through the end of the decade. CBRE’s data projects a steady stream of incoming supply following the 2026 peak. About 224,300 sqm is set to be completed in 2027 while the year 2028 sees a total of about 327,300 sqm of incoming office supply.
"The data suggests that occupiers are increasingly looking toward emerging districts that offer modern infrastructure and closer proximity to residential talent pools," said CBRE Philippines’ Country Head Jie Espinosa.
New inventory for the south
Meanwhile, the Cebu office market has reached its tightest point in half a decade, although a significant wave of new inventory slated for 2026 may soon shift the leverage back toward tenants.
Cebu’s primary business hubs are currently experiencing a historic squeeze with Cebu Business Park’s and Cebu IT Park’s current vacancy at 9.7 percent and 11 percent, respectively. By the end of the year, both industrial parks will likely enter single-digit vacancy territory for the first time in 5 years with 7.3 percent and 6.4 percent, respectively.
This scarcity made central Cebu one of the tightest office markets in the country through the end of 2025, likely resulting in higher rental rates for occupiers who insist on a presence in the city’s core. In stark contrast, "fringe" locations are struggling to keep pace, with vacancy rates in these outlying areas forecasted to hit a staggering 41.2 percent by the end of the year.
This disparity is forcing developers in non-central locations to offer aggressive rental rates to remain competitive.
The current supply drought is expected to break in early 2026 as CBRE highlights a massive influx of space that will redefine the market balance. There are approximately 90,000 sqm of new supply scheduled to arrive in the first quarter of 2026 alone. The North Reclamation Area will headline the expansion, anchored by a massive 60,000 sqm office project by SM.
The Mactan submarket is forecasted to maintain a vacancy rate of 25.7 percent by the end of 2026.
While current conditions favor landlords in the city center, the year-end 2026 forecast suggests a market-wide correction. With the completion of several major projects, the overall Cebu vacancy rate is projected to rise to 15.4 percent by the end of next year.
"Developers in fringe locations will continue to feel the pressure," Espinosa said. "New completions will skew the balance of availability in the city, forcing a more competitive environment for those seeking to fill large-scale office footprints."
