How much does it cost to rent or lease office space in Manila?

How much does office space rent in Manila cost?

Office space rent in Manila typically runs from about Php 500 to Php 1,200 per square meter each month for the main business districts, and utilities, tax, and fit-out can add 30% to 100% more on top.

• Ortigas is the most affordable major hub, while BGC and prime Makati towers command the highest headline rents.
• The market is oversupplied and tenant-friendly, so there is real room to negotiate.
• Hidden costs (utilities, VAT, build-out, and compliance) often matter more than the base rate.

The full cost of office space rent in Manila involves far more than the base lease price. There are many considerations when you establish what it really costs to rent or lease office space in Metro Manila, and the list below is only a starting point. Leasing an office can be complex, time-consuming, expensive, and a long-term commitment.

Office lease costs: all in

It is easy for someone unfamiliar with commercial leasing to look only at the base price and assume they will save a lot by leasing their own office. However, that view overlooks the hidden and indirect costs, such as time, hassle, contracts, and commitment.

Once you are locked into an office, you generally have few options if you want to move, expand, or shrink. As a result, for a fast-growing company, leasing and fitting out an office can become an expensive and time-consuming mistake.

Office rental rates in the Philippines

Office prices are heavily subject to market forces, and they vary widely depending on when and where you look. For a period, COVID-19 played a major role in the price and availability of office space in Metro Manila. That disruption has passed, yet the market it left behind remains oversupplied and favorable to tenants.

Office space rent in Manila: current rates

The following is a broad guide to headline office lease costs across the main districts, quoted per square meter per month:

• Ortigas: Php 500 to 950 /sqm/mo (about $9 to $17)
• Makati: Php 850 to 1,000 /sqm/mo (about $15 to $18), with prime towers reaching Php 2,400
• BGC: Php 800 to 1,200 /sqm/mo (about $14 to $21)

Because supply outstrips demand across most districts, there is more room to negotiate than there has been in years. In addition, keep these cost drivers in mind:

• Electricity (A/C), utilities, CUSA, and internet (with backup) can add 30% to 50% on top.
• VAT (tax) adds 12% on top. PEZA provides VAT exemptions, however BPOs, captives, and shared services generate few VAT receipts to balance those payments, so it can become expensive.
• Ortigas has absorbed a large wave of new A-Grade supply, which gives tenants leverage, although many of those units are handed over as bare shells.

Office density restrictions

• Typical desk density is 1 desk per 5 to 7.5 sqm.
• You are not allowed to go below 1:5 sqm, and some buildings cap the ratio at 1:7.5.
• PEZA buildings typically run 1:10 (though this can vary), so 1,000 sqm can hold roughly 150 to 200 desks.

Getting a good deal on office space rent in Manila

• With demand soft and landlords slow to reprice, tenants have a better chance than ever to secure favorable terms.
• Payment required: typically a minimum of 3 months deposit and 3 months rent in advance.
• You would be lucky to find two high-quality units in the same building at the exact point you want to expand. In my experience, it is rare for BPOs to group their offices together.

Approximate office setup or build-out costs

• Even a 90% ready office still needs some work, plus furniture, desks, chairs, and computers, at roughly $1,000 to $1,500 per desk.
• Renovating from a cold shell can cost $400 to $600 per sqm.
• Everything takes longer in the Philippines, which adds time and stress.
• Once you include hardware and networking, you can easily spend $3,000 to $5,000 per desk.
• For upfront fit-out capital, best practice is to depreciate the cost over a 5-year term. For example, a $500,000 fit-out on a 1,000 sqm office amortizes over 60 months at about $8,333 per month, which adds considerable monthly cost on top of the base lease.

PEZA (Philippine Economic Zone Authority)

• PEZA is a tax incentive scheme.
• It allows you to save VAT and other costs, but you can only lease from PEZA-authorized buildings, and those buildings command higher rents and demand than non-PEZA space.
• For years, new PEZA accreditations have been limited, so PEZA-approved space stays in shorter supply, especially around Ortigas.

IT, network, and compliance

• Basic IT, servers, security, and two internet lines are required.
• There is a raft of compliance items to work through once you have an office, and even more if you are PEZA, so you need someone dedicated to office compliance.

Manila office facilities

• Make sure the building has no night-shift supplements for elevators and A/C. This is not uncommon, and it is vital to check because the costs can be punitive.

Quick summary of office cost calculations

• A nice office would likely cost around Php 1,000/sqm ($17), with everything on top adding another 50%.
• 200 seats at 6.5 sqm equals 1,300 sqm, or about Php 1,950,000 per month (roughly $33,000 to $34,000).
• That works out to about $170 per desk per month at full capacity. However, at 50% occupancy it is closer to $340 per seat.
• You can run double shifts, which reduces the overall cost per seat.
• There is a common conundrum: lease a small office you fully occupy for the best cost, then quickly grow out of it and need another (which adds cost).
• The cost per desk varies hugely with average occupancy over the lease term. For example, at 30% occupancy the cost is roughly $560 per seat, whereas two full shifts can drop it to well under $100.

How much does the average office cost?

In short, the answer is complicated. Prices vary dramatically, and there are many hidden and indirect costs. The final, accurate price of a lease can really only be known in hindsight.

For example, once you have been in an office for five years, you can look back on every cost and properly assess the total. When you project costs forward, by contrast, you are factoring in many uncertainties and assumptions.

Office leasing and seat leasing

If you want flexibility, price stability, and certainty, then seat leasing, BPO or office leasing is your best bet. It is not only more flexible and convenient; surprisingly, it can also work out significantly cheaper.

The outsourcing industry in the Philippines is now mature, sophisticated, and highly competitive, so it operates on very low margins. As a result, it is very possible to find great deals within the turnkey, pay-to-play market.

Frequently asked questions about office space rent in Manila

What is the average office space rent in Manila per square meter?

Headline rents for prime and Grade A space generally sit between Php 500 and Php 1,200 per square meter per month, depending on the district. Ortigas is usually the cheapest, while BGC and premium Makati towers sit at the top of the range.

Which Metro Manila district is cheapest for office space?

Ortigas typically offers the lowest headline rates, partly because a large volume of new A-Grade supply has entered the market. Because of that oversupply, tenants can often negotiate favorable terms there.

What extra costs come on top of the base rent?

Expect utilities, CUSA, and internet to add 30% to 50%, plus 12% VAT unless you qualify for a PEZA exemption. In addition, one-time build-out and hardware costs can reach $3,000 to $5,000 per desk.

Is it cheaper to lease an office or use seat leasing?

Seat leasing or a BPO arrangement is often cheaper and far more flexible than a direct lease. Because providers operate at scale and on thin margins, they can pass on savings that are hard to match on your own.

How much deposit is required to lease office space in Manila?

Landlords typically require a minimum of three months deposit plus three months rent in advance. As a result, you should budget for a significant upfront cash outlay before you even begin fit-out.

Key takeaways

• Office space rent in Manila ranges from about Php 500 to Php 1,200 per sqm per month across the main districts.
• Utilities, VAT, fit-out, and compliance can add 30% to 100% on top of the base rate.
• The market is oversupplied and tenant-friendly, so negotiation leverage is strong.
• Occupancy rate is the single biggest driver of cost per desk over the life of a lease.
• For flexibility and lower risk, seat leasing or a BPO office is often the smarter option.