Central Luzon getting hotter as industrial hub

MANILA, Philippines — Property firms wishing to attract more locators in their industrial developments should highly consider expanding in Central Luzon. The region has been emerging as one of the country’s most attractive investment hubs.

Real estate broker Colliers Philippines said in its first semester industrial report that 870 hectares (ha) of new industrial space may be available from 2025 to 2028.

This is almost twice the new supply that is seen to be completed within the Cavite, Laguna and Batangas (Calaba) corridor, it said.

READ: Central Luzon at the center of industrial revitalization

In the first semester, demand for industrial spaces doubled to 10 ha from 5 ha in the same period last year. Electronics, medical instruments and agro-industrial firms took up most of the space.

Meanwhile, companies focused on semiconductors, consumer goods, cosmetics and cars will likely be the main demand drivers in the second semester, according to Colliers.

Foreign investments in Central Luzon

Data from the Philippine Statistics Authority show that Central Luzon cornered P14.9 billion worth of approved foreign investments in the first quarter of the year. This represented more than half of the total P27.9-billion pledges in that period.

“Colliers sees Central Luzon emerging as a key industrial hub outside the Calaba corridor, driven by investments from high-value manufacturers,” it said. The firm was referring to pharmaceutical, fiber cement products, tire and semiconductor segments.

READ: DA: Central Luzon farms contributed 20% to PH rice output in 2021

“In our view, the development of new industrial parks and facilities in Central and Southern Luzon should provide potential locators with more options and opportunities to haggle for more attractive land leasehold and warehouse lease rates,” Colliers added.

At the same time, developers are encouraged to explore “sunrise industries” that could become the country’s new source of growth, including electric vehicles.

With trade tensions mounting in the past year due to the United States’ new tariffs, Colliers is likewise pushing industrial developers to pursue investment opportunities from other nontraditional trade partners like Taiwan, South Korea, Japan, Thailand, Vietnam and Canada.

“More companies will likely look into the Southeast Asia region as a new hub for manufacturing expansions driven by diversification of supply chain and tapping of alternative resources outside of China,” Colliers noted. /rwd