MANILA, Philippines - Go to any shopping mall in Metro Manila and you'll find new foreign branded shops and restaurants opening almost every week.
From luxury cars to fast fashion to ramen, it seems like global brands are finally realizing the importance of the Philippine market. The growing Philippine economy has boosted consumer sentiment, as Filipinos spend more money on food, gadgets, clothes and even luxury goods.
"New brands coming in. With Filipinos having more money to spend on luxuries, retailers are reacting to that and adding international brands one after the other, expanding into various price points to cover all segments," Lylah Fronda, Jones Lang LaSalle associate director for tenant representation, said in a recent briefing.
"Store Specialists, SM Investments, Bench group and Robinsons Specialty Stores have been bringing these brands to the country to cater to the evolving shopping preference of Filipinos," Fronda added.
In its 2nd quarter market report, CBRE Philippines also noted the continued growth of the retail market in the country, due to benign inflation and strong purchasing power of Filipinos.
"Retail market businesses will remain profitable for the remainder of the year due to a strengthening Philippine economy, driven by the growing BPO industry, OFW remittances and strengthening middle market that can sustain the operations of retail establishments," CBRE said.
Brands such as Stefanel, Miss Selfridge, Suiteblanco, TM Lewin, BB Dakota, Farah Vintage, Paul Boulangerie and NBA Cafe have opened in the new SM Aura in Taguig in the second quarter of the year.
Other global brands have opened stores in the new Shangri-la East Wing, Robinsons Magnolia, Glorietta and Greenbelt.
CBRE noted approximately 7,579 square meters of leasable space has been taken up by international brands in the second quarter alone.
As international brands jockey for prime position in malls, rent for retail spaces is edging higher. "High demand for global brands heightened the competition for limited retail spaces, thereby pushing rents up," CBRE said.
However, supply pressure is expected to ease as approximately 432,000 square meters of additional gross leasable area will be available this year.