Philippine industrial market shows wide rent range across regions

Rental premiums favor Southern Luzon, whilst North Luzon offers cheaper alternatives.

Industrial rental rates in the Philippines reflect strong locational preferences, with Southern Luzon commanding a clear premium over emerging northern hubs, according to Savills Philippines.

Savills’ latest report shows Batangas commanding the highest average rent at PHP288 per sq m, reflecting limited supply and high demand from logistics and distribution companies. Batangas’ modern warehouse facilities and proximity to Batangas Port make it a preferred choice for locators seeking premium, ready-built spaces.

Laguna also ranks among the top industrial rental markets, with average rents of PHP284 per sq m and a wide range of options between PHP180 and PHP350 per sq m. This range accommodates both older, lower-cost facilities and newer, high-end warehouses, allowing companies flexibility depending on budget and operational requirements.

Cavite follows closely, with an average rent of PHP276 per sq m and maximum rates reaching PHP300 per sq m. While some older estates face competitiveness challenges compared to newer developments, Cavite’s mature infrastructure and connectivity help maintain strong rental levels.

In contrast, North Luzon provinces such as Bulacan and Pampanga offer lower rental rates, averaging PHP194 per sq m and PHP209 per sq m, respectively. Savills highlighted that these provinces are introducing newer, higher-quality facilities to attract locators seeking cost-effective alternatives outside Southern Luzon. Rental ranges in these northern hubs are narrower, typically PHP120–PHP280 per sq m, reflecting a mix of legacy stock and newer warehouses entering the market.

Overall, Savills concluded that while emerging northern markets show promise for cost-sensitive tenants, industrial rental premiums continue to be commanded by Southern Luzon hubs due to superior infrastructure, logistical access, and proximity to Metro Manila.