KMC MAG Group presents the Metro Manila Office Briefing for the second quarter of 2015.

1. KMC MAG Group Research
Metro Manila
kmcmaggroup.com/research
Metro Manila
Office Briefing Q2 2015
THE FACTS AT A GLANCE
Marketplace eagerly awaits new supply to match demand
ÀÀ Net take-up of Premium and
Grade A office spaces across
all CBDs reached only 36,061
sq m in Q2/2015, once
again hindered by the supply
features.
ÀÀ New supply was also limited
in the second quarter of the
year, as only one project
was completed while several
projects slated for completion
in Q2/2015 have been moved
to the second half of 2015 and
early 2016.
ÀÀ As a result of the healthy
demand and no new supply,
the overall vacancy rate
remains low at 3.3% in
Q2/2015, slightly declining
from 3.7% in Q1/2015.
ÀÀ On average, the rental rate of
Grade A offices increased to
1.5% QoQ to Php 809.2 per
sq m/month in Q2/2015 from
Php 802.0 per sq m/month in
Q1/2015.
ÀÀ Although stock turnover
was limited in H1/2015, an
additional 430,000 sq m of
leasable Grade A office space
is expected to enter the main
CBD markets by the end of
2015, with around 44% to rise
in Bonifacio Global City.
ÀÀ In the short term, the current
trend is likely to continue
with rents expected to grow
around 5.0-7.0% in the next
12 months. The large pipeline
will put some pressure on
vacancies that are seen to
slightly increase until 2018.

2. kmcmaggroup.com/research | 2
Q2 2015Metro Manila | Office Briefing
Office Market Snapshot | Makati CBD
GRAPH 1
Stock & Vacancy
GRAPH 2
Supply & Take-up
GRAPH 3
Rental Performance
Makati CBD Market in Minutes
ÀÀ In Q2/2015 prime rental rates in Makati surprisingly recorded only a modest 2.6% YoY growth to Php 958.6
per sq m/month despite the low vacancy rate of 3.8%.
ÀÀ One reason for the modest rental growth might be the slow leasing activity in Tower 6789, which remains
almost unoccupied.
ÀÀ Rentals in the district are expected to keep climbing as no new stock is expected in the CBD until 2018. Makati
still quotes the highest rentals as the current upper net rental rate is now at Php 1,400 per sq m/month.
Unit Q2/2015
Average net rental rate Php/sq m/month 958.6
Upper net rental rate Php/sq m/month 1,400.0
Average capital value Php/sq m 181,402.4
Equivalent yield % 8.50
Vacancy rate % 3.8
Current stock sq m 1,080,863
Development pipeline 2015-2018 sq m 55,400
TABLE 1
Key Figures - Premium and Grade A Office
Source: KMC Research & Consultancy Source: KMC Research & Consultancy
Source: KMC Research & Consultancy Source: KMC Research & Consultancy

3. kmcmaggroup.com/research | 3
Q2 2015Metro Manila | Office Briefing
Office Market Snapshot | Bonifacio Global City
GRAPH 5
Supply & Take-up
GRAPH 6
Rental Performance
BGC Market in Minutes
ÀÀ Prime rental rates in BGC continue to be promising with Q2/2015 rates increasing by 6.8% YoY, with
average Grade A rent in the district at Php 855.0 per sq m/month. BGC’s vacancy rate further decreased
to 1.3% due to low supply turnover and solid take-up at around 16,743 sq m for Q2/2015.
ÀÀ The additional 190,000 sq m office space for turnover in 2H/2015 will likely increase vacancy as the
market has limited time to absorb new supply despite strong pre-leasing activity.
ÀÀ Construction activity in BGC will continue to remain active, with a pipeline of one million sq m doubling the
stock by 2018.
Unit Q2/2015
Average net rental rate Php/sq m/month 855.0
Upper net rental rate Php/sq m/month 1,100.0
Average capital value Php/sq m 150,039.5
Equivalent yield % 8.75
Vacancy rate % 1.3
Current stock sq m 779,667
Development pipeline 2015-2018 sq m 1,001,881
TABLE 2
Key Figures - Grade A Office
GRAPH 4
Stock & Vacancy
Source: KMC Research & Consultancy Source: KMC Research & Consultancy
Source: KMC Research & Consultancy Source: KMC Research & Consultancy

4. kmcmaggroup.com/research | 4
Q2 2015Metro Manila | Office Briefing
Office Market Snapshot | Ortigas Center
Ortigas Center Market in Minutes
ÀÀ Average Grade A rental rate rose by 3.7% YoY at Php 609.9 per sq m/month in Q2/2015 from Php 588.3
per sq m/month in the same period last year. The vacancy rate decreased by a marginal 20 basis points to
3.5% in the quarter
ÀÀ In the next quarter, the CBD is expecting to see the turnover of the iconic BDO Corporate Center, which will
house the largest bank in the country
ÀÀ Other than the BDO Corporate Center, no new leasable space is expected to enter the market until the
second half of 2016, which will likely keep the vacancies declining and rental growth increasing.
GRAPH 7
Stock & Vacancy
GRAPH 8
Supply & Take-up
GRAPH 9
Rental Performance
Unit Q2/2015
Average net rental rate Php/sq m/month 609.9
Upper net rental rate Php/sq m/month 750.0
Average capital value Php/sq m 91,916.6
Equivalent yield % 9.00
Vacancy rate % 3.5
Current stock sq m 546,199
Development pipeline 2015-2018 sq m 191,389
TABLE 3
Key Figures - Grade A Office
Source: KMC Research & Consultancy Source: KMC Research & Consultancy
Source: KMC Research & Consultancy Source: KMC Research & Consultancy

5. kmcmaggroup.com/research | 5
Q2 2015Metro Manila | Office Briefing
Office Market Snapshot | Alabang
Alabang Market in Minutes
ÀÀ Average rental rate in Alabang grew only by 0.2% YoY to Php 602.4 per sq m/month in Q2/2015.
ÀÀ Rentals in Alabang are expected to stagnate or even decline as the market needs time to absorb the latest
and the upcoming supply additions. Lower rental rates would also help alleviate the district’s 14.1% vacancy
rate for Q2/2015.
ÀÀ The rather slow take-up might reflect to lower demand as occupiers prefer to locate in more accessible and
public commuter-friendly business districts.
GRAPH 10
Stock & Vacancy
GRAPH 11
Supply & Take-up
GRAPH 12
Rental Performance
Unit Q2/2015
Average net rental rate Php/sq m/month 602.4
Upper net rental rate Php/sq m/month 650.0
Average capital value Php/sq m 66,605.0
Equivalent yield % 10.50
Vacancy rate % 14.1
Current stock sq m 256,110
Development pipeline 2015-2018 sq m 289,079
TABLE 4
Key Figures - Grade A Office
Source: KMC Research & Consultancy Source: KMC Research & Consultancy
Source: KMC Research & Consultancy Source: KMC Research & Consultancy

6. kmcmaggroup.com/research | 6
Q2 2015Metro Manila | Office Briefing
Office Market Snapshot | Quezon City
Quezon City Market in Minutes
ÀÀ Average rental rate increased by 7.8% YoY to Php 688.1 per sq m/month in Q2/2015 while vacancy rate
remains low at 1.0%.
ÀÀ The low vacancy rate and strong rental growth have placed Quezon City as one of the best performing
submarkets in Metro Manila. As a result, property developers now eye the submarket for their projects.
ÀÀ Pipeline for new office stock is mainly through Ayala Land’s Vertis North Corporate Center towers and
Araneta Group’s Cyberpark Tower One, which will be the first of the five-tower series.
GRAPH 13
Stock & Vacancy
GRAPH 14
Supply & Take-up
GRAPH 15
Rental Performance
TABLE 5
Key Figures - Grade A Office
Unit Q2/2015
Average net rental rate Php/sq m/month 688.1
Upper net rental rate Php/sq m/month 700.0
Average capital value Php/sq m 103,189.9
Equivalent yield % 10.50
Vacancy rate % 1.0
Current stock sq m 379,151
Development pipeline 2015-2018 sq m 196,276
Source: KMC Research & Consultancy Source: KMC Research & Consultancy
Source: KMC Research & Consultancy Source: KMC Research & Consultancy

7. kmcmaggroup.com/research | 7
Q2 2015Metro Manila | Office Briefing
Office Market Snapshot | Bay Area
GRAPH 16
Stock & Vacancy
GRAPH 17
Supply & Take-up
GRAPH 18
Rental Performance
Bay Area Market in Minutes
ÀÀ Bay Area posted the highest rental growth rate at 18.3% YoY, bringing rental rate to Php 655.1 per sq m/
month; and the lowest vacancy rate at 0.5% among all districts in Q2/2015.
ÀÀ However, vacancies in Bay Area are likely to rise in the next three quarters, as a result of the turnover of a
total of 120,000 sq m of new office space in the emerging business district.
ÀÀ Likewise, beyond 2016, several planned office developments such as two more E-Com towers, Aseana Three
and four office towers in the 4.5-hectare DoubleDragon Meridian Plaza will keep the construction activity in
Bay Area robust.
Unit Q2/2015
Average net rental rate Php/sq m/month 655.1
Upper net rental rate Php/sq m/month 700.0
Average capital value Php/sq m 94,876.0
Equivalent yield % 10.50
Vacancy rate % 0.5
Current stock sq m 224,391
Development pipeline 2015-2018 sq m 232,319
Source: KMC Research & Consultancy Source: KMC Research & Consultancy
Source: KMC Research & Consultancy Source: KMC Research & Consultancy
TABLE 6
Key Figures - Grade A Office

8. KMC MAG Group
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Since 2009, KMC MAG Group has provided clients with award-winning real estate services. As an international associate of Savills, KMC delivers world-class service
strengthened with local market expertise. With over 100 employees involved directly in transactions for office, investments, industrial & hotel locators, as well as
residential properties, KMC is a full-service real estate firm that has successfully become the leading local firm in the Philippine real estate services industry.
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Yves Luethi
Vice President
yves.luethi@kmcmaggroup.com
Gerold Fernando
Associate Director-
Office Leasing
gerold@kmcmaggroup.com
Michael McCullough
Managing Director
michael@kmcmaggroup.com
Rosario Carbonell
Associate Director-
Office Leasing
rosario@kmcmaggroup.com
Antton Nordberg
Head of Research
antton.nordberg@kmcmaggroup.com
Lana Osmeña
General Manager-
Cebu
lana@kmcmaggroup.com
KMC MAG Group
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