Philippines’ penchant for online shopping to lift Manila’s logistics property rents by up to 5% this year: Knight Frank

Rents for industrial space in Manila are likely to rise between 3 per cent and 5 per cent this year after jumping nearly 40 per cent last year, Knight Frank says

Cities on Australia’s eastern seaboard such as Sydney and Brisbane are likely to see rental increases of more than 5 per cent

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The outlook for logistics property rents in Manila is rosy. Photo: Getty Images

Published: 7:30am, 19 Feb 2024

Filipinos’ fondness for online shopping is set to further boost Manila’s logistics property rents this year after surging nearly 40 per cent in 2023, catapulting the Philippines’ capital over Sydney as the best-performing city in Asia-Pacific for this category, according to Knight Frank.

Industrial property rents are expected to rise by another 3 per cent to 5 per cent this year, according to a report by the real estate consultancy.

“The surge in the number of online merchants in the Philippines has significantly increased the demand for logistics space in Manila,” said Christine Li, head of research for Asia-Pacific at Knight Frank.

The Australian cities of Sydney and Brisbane rounded off the top three cities in Asia-Pacific, with year-on-year rents for industrial space gaining 16.7 per cent and 15.3 per cent, respectively, in 2023, according to the study, which tracked 17 cities in the region.

Buildings in Makati City, Metro Manila, the Philippines. The country’s fast-growing economy is boosting demand for industrial space. Photo: Bloomberg

Hong Kong ranked fourth in this category with year-on-year rental growth of 9 per cent. In the second half of 2023, the city had the second-best rental growth at 4.7 per cent.