At least 85 coworking spaces and serviced offices, two types of flexible workspace solutions, have cropped up in Metro Manila’s major central business districts (CBDs), according to data from real estate market analyst Leechiu Property Consultants (LPC). Flexible workspaces are preferred by startups and rapidly growing companies that find the traditional office setup a constraint to their fluid workflow.
In its report “Serviced Office/Co-Working Space Real Estate Insights” published March 2018, LPC mapped the various coworking spaces found in the Makati, Bonifacio Global City and Ortigas Center CBDs, as well as adjacent areas such as the cities of Taguig, Mandaluyong and Pasig. All in all, LPC found 51 serviced offices and 34 coworking spaces in these areas, which cover more than 90,000 square meters of prime office space combined.
LPC defines serviced offices as “a fully fitted office space… ran by a facility management company, who then rents out private rooms to other individuals or companies.” On the other hand, it describes coworking spaces as “membership-based open workspaces where diverse groups of freelancers, remote workers and other independent professionals work together in a shared, communal/open, café-like setting.”
As flexible workspace arrangements, both serviced offices and coworking spaces offer benefits above traditional office spaces to various tenants, namely their low capital requirements, flexible leasing terms and collaborative setups. According to LPC, such benefits have pushed flexible workspace developers to compete for prime locations in these CBDs as demand for these spaces continues to rise.
“Doing business from out of a flexible workspace is now quite popular in Hong Kong and Singapore,” said Phillip Anonuevo, director at LPC, in a statement. “It looks like entrepreneurs and professionals in the Philippines are now also seeing the benefits of these options.”
However, despite the growing popularity of these new types of offices, flexible workspaces still constitute a very small percent of office space in these prime areas. As shown in the infographic above, flexible workspaces in these CBDs only make up around one or two percent of each area’s total office supply.
As well, the pipelines of office supply in these CBDs vastly outnumber the current supply of flexible workspaces, according to data from LPC’s Market Insights report for March 2018. This indicates that while flexible office solutions are growing in popularity, traditional offices are far from being replaced as the preferred office setup in Metro Manila.
Lorenzo Kyle Subido is a staff writer of Entrepreneur PH