Foreign retailers are fueling a stronger-than-expected rebound in the Philippine retail property sector, boosting mall occupancy and spurring renewed investment in brick-and-mortar spaces across Metro Manila and key provincial cities, Colliers Philippines said.
The real estate consultancy firm expects Metro Manila’s retail vacancy rate to fall below 10 percent by the fourth quarter of 2026, earlier than the previously set 2027 target. This accelerated recovery is driven by robust demand intersecting with limited new supply, it said.
Joey Roi Bondoc, Colliers director and head of research, noted that foreign brands remain a key growth driver, aggressively expanding and securing large floor areas for flagship concepts in major malls.
Brands like Japan’s Nitori, Australia’s Anko and the returning Decathlon are reportedly expanding, while established names such as Muji and IKEA are opening larger flagship stores spanning thousands of square meters.
“Foreign retailers are leading the take-up in major malls, often securing huge floor areas for their flagship concepts,” Bondoc said in a virtual presentation on Thursday.
Despite the popularity of online shopping, surveys indicate that most Filipinos continue to visit physical stores, making omnichannel strategies essential for developers, Bondoc said.
Developers are injecting billions into mall refurbishments and new projects, anticipating sustained robust demand, particularly through the holiday season, supported by bonuses and higher overseas Filipino worker (OFW) remittances.
Developers are strategically limiting new mall openings to sustain high occupancy, projecting that new supply from 2026 to 2028 will average only 111,000 square meters annually—just a third of pre-pandemic completion levels.
Upcoming projects include Ayala’s Greenbelt redevelopment, SM Megamall’s expansion and new malls in Arca South, Parklinks and the C5 corridor. Major players like Ayala Land, SM Prime Holdings and Robinsons Land Corp. are investing heavily in modernizing their portfolios.
Ayala is allotting P13 billion for several Cebu expansions.
SM plans to spend P150 billion over five years to redevelop 16 existing malls and build 12 new ones, primarily outside Metro Manila.
Robinsons Land aims to increase its mall network to 69 by 2030, boosting leasable retail space by 50 percent.
Malls are also evolving into leisure destinations through “experiential retail” concepts designed to encourage longer visits and higher spending. Examples include SM Mall of Asia’s football field and Muji’s flagship store in Glorietta, which features a bakery and a coffee counter.
Metro Manila hosts about eight million square meters of leasable retail space.
