While setting up a business in Hong Kong will take you just a couple of days – or even less than that-, finding an affordable office space will definitely be much more than a headache. A completely opposite scenario can be seen 700 miles away from there. Philippines, the 95th country to do business in the world, has one of the cheapest office space rents in the whole Southeast Asia, a very attractive factor for foreign investors.
Despite of still being concentrated, Philippines offers a wide range of options within its business districts that are suitable for any size of enterprise. Metro Manila, the metropolitan area composed of more than 15 cities, counts three Central Business Districts (CBDs): Makati, Bonifacio Global City and Ortigas.
Considered the main business and financial district, Makati hosts multinational corporations, shopping malls and entertainment spots aside from some governmental agencies. An office there (grade A) was costing PHP 700 – PHP 1,000 (around USD 14 – USD 23) per square meter in the second quarter of 2014. These numbers show why Makati was ranked the number 55 among 67 cities around the world in a rank published in Cushman & Wakefield global Office Space Across the World for office rent prices in 2014.
Reaching over 62,000 establishments, Makati has a low vacancy rate as there is not much possibility to expand new developments. This scenario benefits other business locations in Metro Manila, especially Fort Bonifacio, a new and emerging business district that has risen from a former military camp in just a decade and is located just 20 minutes away from Makati. Bonifacio Global City (BGC), which is part of what is commonly known as The Fort, became the main target of developing companies aiming to meet the demand for more office space. A square meter there would cost around PHP 800 (USD 20) for an office grade A. Recent developments in the district are: Sm Aura Office Tower, 8 Campus Place Tower 3 and Globe Telecom Building.
Bonifacio Global City had the highest take up rate among all CBDs in 2013. Despite of annual increase in the supply, vacancy rate remains low, averaging 2.9%. International companies and outsourcing businesses have established their offices there due to its better infrastructure, easy access and local services provided. Less modern and targeted by the developers, Ortigas is the second largest business district in Metro Manila, hosting some of the biggest local companies and international organizations such as San Miguel Corporation and Asian Development Bank, respectively. Ortigas has also the lowest vacancy rate among the three CBDs: 2.5% and the lowest office space rent per square meter: 650 pesos and a stable perspective for the next years.
Philippines can offer cheap labor force and rental cost but remains a difficult country to open a business due to its bureaucracy and restriction to foreign investments. If you wish to set up your company in the country and need advice, don’t hesitate to contact Triple i. With more than 200 companies registered in the Philippines, we advise and assist clients to succeed in setting up their business.