Metro Manila’s retail market has bounced back significantly since the beginning of the pandemic. Once empty malls are now filled not just with visitors but also tenants. Overall, an optimistic consumer sentiment is driving back foot traffic to malls to almost the same level as pre-pandemic.
Consider these figures: Household Final Consumption Expenditure (HFCE) increased by 6.0% on a year-on-year basis, despite looming inflation rate, basic goods and utilities such as; food, housing, and electricity, recorded a 4% year-on-year growth respectively. Consumption of food and non-alcoholic beverages grew by 4% which covers 43% of the total household spending.
The waning effect of the pandemic has resulted in higher confidence in traveling, recreational revenge spending, and substantial increase in foot traffic. These factors combined have helped the retail market to be back on track. Metro Manila’s retail market recorded a positive occupancy of 93% which accounts to almost 4.5M sqm of occupied space, nearing pre-pandemic occupancy of 96%.
Quezon City posted the highest occupancy rate among the different business districts at 95% followed by Makati at 94%. Taguig City was outpaced by both Makati, and Quezon City as the newly opened Mitsukoshi.
Malls added 19,600 sqm of vacant space in Taguig’s vacancy. These three areas: Makati, Taguig, and Quezon City, have the largest concentration of mall spaces, as most commercial activities are happening in places near offices.
The Bay area fared significantly slower as occupancy was recorded at 90%. Vacant spaces in the Bay area remain unchanged since stores that were about to open during the previous quarters were halted as a result of the pandemic restrictions. At least 169 upcoming stores in Metro Manila Retail were recorded as of end 2022. F&B holds the largest share in tenancy mix accounting to almost 30%, followed by clothing and apparel at approximately 28%.
In malls, local F&B destination brands are seen expanding in Metro Manila, such as Breakfast at Antonio’s and Tsokolateria. Another restaurant known in Tagaytay is expanding in Metro Manila, Tsokolateria is set to open in Greenbelt 5. Moreover, international brands were also observed to be expanding its presence in the Philippine Market, some of these brands are Urban Revivo, and Kinokumiya. International mall expansion was also recorded in Metro Manila retail market, Mitsokushi, a Japanese retail brand has opened in Taguig City, injecting a total retail space of 28,000 sqm.