KMC Research

Metro Clark
Office Briefing 1H 2021
Metro Clark | Office Briefing

Metro Clark Office Submarkets

Future Stock (2024)
MAP 1

CLARK
FREEPORT
ZONE CLARK
GLOBAL CITY
PHILEXCEL
SM CITY
CLARK

MARQUEE

ANGELES CITY
ANGELES
ENTEC

ALVIERA

Legend
ANGELES CITY AH26
MABALACAT CITY NLEX
SCTEX
PORAC
MAGALANG
MEXICO
SAN FERNANDO CITY
BACOLOR 464,496 sq m 44,364 sq m
CFZ ANGELES

Source: KMC Savills Research

DEVELOPMENT PIPELINE (2021-2024) CURRENT STOCK

TABLE 1
Key Figures - Grade A Office
1H 2021 Unit CFZ Angeles Metro Clark

PHP/sq m 542.3 390.6 521.4

Average net rental rate
USD/sq ft 1.0 0.8 1.0

PHP/sq m 650.0 500.0 650.0

Upper net rental rate
USD/sq ft 1.3 1.0 1.3

Vacancy rate % 21.6% 36.1% 23.5%

Current Stock sq m 291,484 44,364 306,925

Development Pipeline 2021-2024 sq m 173,012 0 154,321

Source: KMC Savills Research

2
 1H 2021

Metro Clark

GRAPH 1 GRAPH 2
Stock & Vacancy Supply & Take-Up
Metro Clark Office Stock Metro Clark Office Supply
Metro Clark Office Vacancy Rate Metro Clark Office Take-Up
600 45% 120

100

80

'000 sq m (GLA)
'000 sq m (GLA)

400 30% 60

40

20

200 15% 0

-20

-40

0 0% -60
2013 2014 2015 2016 2017 2018 2019 2020 2021F 2022F 2013 2014 2015 2016 2017 2018 2019 2020 2021F 2022F

Source: KMC Savills Research Source: KMC Savills Research

GRAPH 3 GRAPH 4
Rental Performance Development Pipeline
120
Metro Clark Office Rental Growth YoY
Metro Clark Office Rental Rates
600 12%
100

550 9%
'000 sq m (GLA)

80
500 6%
Php / sq m / month

450 3% 60

400 0%
40
350 -3%

300 -6% 20
18

18

18

19

19

19

19

20

20

20

20

21

21
20

20

20

20

20

20

20

20

20

20

20

20

20
2Q

3Q

4Q

1Q

2Q

3Q

4Q

1Q

2Q

3Q

4Q

1Q

2Q

0
2020 2021F 2022F 2023F 2024F

Source: KMC Savills Research Source: KMC Savills Research

MARKET IN MINUTES
■ With the introduction of around 15,000 sq m of office space and 36,300 sq m of office space vacated during the first half of
2021, the vacancy rate almost tripled at 23.5% from 8.5% in 4Q/2020 – reverting to 2017 levels. Long-term effects of remote
work continue to unfold as we saw pre-termination and non-renewals induced by the pandemic.

■ Average rents declined by 3.7% YoY in 2Q/2021 to PHP521.4 per sq m / month. With the influx of new supply in the coming
periods alongside lackluster leasing activity, rents are anticipated to remain under downward pressure in the short- to mid-
term.

■ Amid the widespread adoption of remote working by both traditional occupiers and the BPO sector, vacancies are expected
to rise significantly as more companies reduce their office footprint. Tenants that are active in the market have ample options
to choose from, and landlords can be expected to offer generous concessions and flexibility to attract and retain tenants.

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KMC Savills, Inc.
Please contact us for further information

Michael McCullough Fredrick Rara

Managing Director Senior Manager
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Executive Director Executive Director
Investor Services Transactions and Advisory Services
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COO Executive Director
Transactions and Advisory Services Transactions and Advisory Services
cha@kmcmaggroup.com john@kmcmaggroup.com

Rita Kash, MCR.w Karen Golez

Senior Director Senior Director
Transactions and Advisory Services Transactions and Advisory Services
rita@kmcmaggroup.com karen.golez@kmcmaggroup.com

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