Davao is one of the most competitive cities in Mindanao, that’s why it is a preferred location of multinational outsourcing companies. The city is also regarded as one of the safest localities in the country, making it an appealing business destination for expatriates. Over the years we have seen Davao faring well in terms of competitiveness, as measured by key indicators including size of domestic economy, disaster resilience, ease of business registration, etc. In our view Davao holds a lot of promise and is one prime location that office landlords and occupants should keep an eye on.
Colliers Philippines believes that the city’s skilled manpower will continue attracting outsourcing locators. This should be supported by the seamless coordination of the city’s business groups, information and communications technology (ICT) councils, and academe.
Colliers is optimistic that the development of more integrated communities in the city should result in the construction of newer and more sustainable office spaces. Tenants should be on the lookout for the completion of these high-quality office spaces and should even consider pre-leasing.
Competitive vacancy outside Metro Manila
As of end-Q2 2025, overall vacancy in Davao reached 5.5 percent (down from 6.6 percent a quarter ago), one of the lowest vacancies outside the capital region due to sustained demand from outsourcing companies.
With this level of vacancy, Davao is the only office market hub outside Metro Manila that enjoys a landlord’s market status.
Office transactions up 32% YoY
In H1 2025, Davao recorded 10,400 sq metres (111,900 sq feet) of office space transactions, up 32 percent YOY and accounting for 7 percent of the total deals in areas outside the National Capital Region (AONCR). Among the notable deals recorded in Davao from 2024 to H1 2025 were spaces occupied by Teleperformance, Alorica, Optum, VA Platinum, Ibex and CubeWork. These firms took up spaces in Matina IT Park (Plaza de Luisa Development Inc.), Robinsons Cybergate Delta 1 (Robinsons Land) and The Uprise (Felcris Hotels and Resorts). Other outsourcing firms that have established their presence in the province are OP360, Concentrix, Wipro, iQor, Cloudstaff, Sutherland, and VXI.
As of end H1 2025, net take-up in Davao reached 23,000 sq meters (247,500 sq feet), already more than double the 10,900 sq meters (117,300 sq feet) of net absorption recorded a year ago. By end-2025, Colliers projects net take-up to reach 30,000 sq meters (322,800 sq feet).
Office supply to grow by 20% by 2027
As of end-Q2 2025, Davao’s office stock reached 379,000 sq meters (4.1 million sq feet). From 2025 to 2027, we project the average annual completion of 26,800 sq meters (288,400 sq feet) of new office space in Davao, up from only 1,600 sq meters (17,200 sq feet) of new supply completed annually from 2021 to 2023. Among the office towers likely to be completed during the period include SM Lanang BPO Towers 1 and 2, One Republic Plaza and Azuela Technohub.
From 2026 to 2027, Colliers sees the completion of new office towers in Davao city by Megaworld, Robinsons Land, Ayala Land, and SM.
Bustling residential hub
Colliers believes that the increasing office transactions in Davao should partly support residential demand in the city. The entry of national property developers such as Megaworld, Ayala Land, Robinsons Land, Filinvest Land, SMDC, Vista Land, and Cebu Landmasters (CLI) also strengthened Davao’s position as a major property investment destination in the VisMin region.
For the condominium segment, among the developers which launched projects since 2024 include Filinvest Land, Torre Lorenzo and Damosa Land. These projects are priced between P180,000 and P283,000 (USD3,200 and USD5,100) per unit with take-up ranging from 63 percent to 100 percent. Meanwhile, CLI, Alsons Properties and Phinma Properties recently launched new house-and-lot projects in the city. Vista Land continues to be a major player in the residential lot only segment.
Property firms are also launching expansive integrated communities in Davao which will feature residential, office and retail components. Ongoing township projects include CLI’s Davao Global Township (DGT), and Alsons Properties’ Northtown. Ayala Land recently launched the 204-hectare Ascenda.
The launch of these master-planned communities will likely be the norm moving forward as Davao residents and investors put a premium on convenience and sustainability. There’s no doubt that Davao is well-positioned to reap the gains of a rebounding and evolving property market down south. Developers and investors should be quick in capturing these opportunities.