Retail absorption moderated in Q1 2026

• Net absorption registered at 10,435 sqm, reflecting post-holiday leasing moderation following the accelerated pace of take-up towards year-end.
• The food and beverage sector drove new store openings, capitalising on stable consumer spending, with local brands dominating market activity.

New retail supply introduced

• An estimated 11,000 sqm of new retail space opened in Q1 2026, adding to retail inventory in the market. More than 200,000 sqm of additional supply is scheduled for completion in 2026.
• The overall vacancy rate held steady at 5.1% in Q1 2026 despite the addition of new supply. Stable demand for existing and new retail space helped contain vacancy increases.

Retail rents and capital values rise

• Average retail rents increased to PHP 1,777 per sqm per month in Q1 2026, rising 0.99% q-o-q and 1.5% y-o-y, reflecting steady retailer demand in the market.
• Capital values reached PHP 243,135 per sqm in Q1 2026, up 0.1% from the previous quarter. The Bangko Sentral ng Pilipinas’ February rate cut of 25 bps to 4.25% further supported investment sentiment by reducing financing costs.

Outlook: Sustained stable retailer demand

• Retailer demand is expected to continue its momentum following the typical first-quarter slowdown, supported by a solid pipeline of upcoming store openings from the food and beverage sector.
• Rental rates are projected to remain stable through Q2 2026, supported by steady occupier interest from both local and foreign brands.