The retail vacancy rate in Metro Manila is projected to return to pre-pandemic levels by 2022, according to a recent study by Colliers Philippines. The rate of empty retail spaces in Metro Manila eased to 11.4% as of September 30, 2021. By the close of next year, forecasts indicate a reduction to 9.5%, almost matching the 9.3% recorded in the third quarter of 2019.
The report also offers long-term projections, with a predicted rate of 8.2% by the end of 2027. This figure is notably lower than the pre-pandemic benchmarks, signaling a positive recovery trend for the retail sector in the region.
The study attributes the anticipated improvement to two main factors. The first is the continuous entry of international retail brands into the Filipino market. The second is the rapid expansion of existing brands.
According to Joey Bondoc, Research Director at Colliers, foreign brands play a crucial role in this trend. He noted that many of these brands have previously exited the market but are now making a significant comeback.
Bondoc further highlighted the attractive refurbishment strategies of major developers in the region, which are drawing in these companies. These refurbishments are focusing more on experiential retail, adding another layer of attraction for both brands and consumers.
The report also shed light on the dominant industries in retail space occupancy. The food and beverage sector, fast fashion, and general retail were listed as the primary occupiers of retail spaces. Their continued presence and growth contribute to the overall decreasing trend of retail vacancies.
What is the anticipated retail vacancy rate in Metro Manila by the end of 2022?
The retail vacancy rate is expected to decrease to 9.5% by the end of 2022.
What factors are contributing to the decrease in retail vacancies?
The entry of foreign retail brands into the Philippines market and the accelerated expansion of existing brands are primarily driving this improvement.
Which industries are the biggest occupiers of retail space in Metro Manila?
The food and beverage sector, fast fashion, and general retail industries are the main occupiers of retail spaces.
