As per the latest survey done by Cisco, the Philippines has the 2nd highest number of employers in the Asia-Pacific (APAC) region requiring a full return to the office post-pandemic.<\/p>\n\n\n\n
According to Cisco’s survey, 93% of local firms have mandated a full or partial return to the office with productivity given as the main driver. 80% of local employees responded positively to the call to return to office and 90% expressed a
desire to return to the office at least a few times per week.<\/p>\n\n\n\n
However, more than 1\/3 of employers expect the average Filipino to be a hybrid worker within 2 years. The hybrid working arrangement is seen to support employees\u2019 wellbeing, allows them to save more and raises their productivity. But only 50% of Filipino employees believe that their office is prepared to adopt to the hybrid set up.<\/p>\n\n\n\n
Cisco\u2019s report on the Phils workplace is based on its survey which covered 9,200 full-time employees and 1,650 employers in November 2023.<\/p>\n\n\n\n
Our View: <\/strong>Office vacancy rates have declined slightly towards end-2023 but remained relatively high at 18% (from 19%) as per the latest report from Lee Chiu. The level is expected to go down further albeit gradually going into 2024 with demand growth coming mainly from the IT-BPOs and some recovery from POGOs.<\/p>\n\n\n\n Despite the increasing return-to-office mandates as per above, elevated vacancy rates are likely to persist, as corporates shift to hybrid work arrangements. Add to that the new legislation being pushed in Congress to allow the BPOs to implement remote work arrangements. <\/p>\n\n\n\n Thus, while we have an overweight rating on the Property Sector given that it is among the major beneficiaries of easing inflation and interest rate, we are more selective and prefer developers with higher exposure to residential (for recovery) and malls (for sustained growth). <\/p>\n\n\n\n Our sector top picks are Robinsons Land Corp. (RLC) and Ayala Land Inc. (ALI) \u2013 the former is our value pick (widest valuation gap vs. peers) while the latter is our proxy for residential recovery.<\/p>\n\n\n\n