By Kathleen A. Martin (The Philippine Star) | Updated January 28, 2015 - 12:00am
MANILA, Philippines - Land values in Metro Manila continued to rise as of end-September last year, boosted largely by the sustained strong demand for office space in the capital, the Bangko Sentral ng Pilipinas said.
Implied land values in the Makati central business district (CBD) went up 35 percent to P435,000 per square meter in the third quarter from a year ago, the central bank said, citing data from Colliers International.
The latest level is also 19 percent higher than the P366,425 per sqm recorded in the second quarter of last year, the BSP said.
“The significant increase in the Makati CBD land value is primarily attributed to the sale of JAKA Tower, an unfinished office building located along the prime area of the business district,” the central bank said.
In Ortigas center, land values grew nine percent to P154,000 per sqm in the third quarter versus the same period in 2013. It was also three percent higher than the P149,365 per sqm recorded in the second quarter of 2014.
“Implied land values in the Makati CBD were slightly above their 1997 levels in nominal terms, but only about 45.1 percent of their 1997 levels in real terms,” the BSP said.
“Meanwhile, land values in the Ortigas Center were lower than their comparable levels in 1997 in both nominal and real terms by about 79 percent and 34.8 percent, respectively,” the central bank said.
Nominal figures refer to the actual price in 1997, while real terms are nominal values adjusted for inflation.
At the same time, the BSP said office vacancy rate in the Makati CBD slid to 1.9 percent in the third quarter last year from 2.1 percent in the second quarter.
“This was due to continued strong office demand amid limited office supply in the Makati CBD. The office vacancy rate is estimated by Colliers to narrow further to 1.6 percent in Q3 2015,” the central bank said.
Residential vacancy rate, meanwhile, also went down to 8.1 percent in the third quarter from 10.6 percent in the second quarter.
The BSP said there were higher occupancy rates observed in high-rise residential segments although Colliers International expects the rate to go up to 10.7 percent by the third quarter of this year as more units will become available.