Southeast Asia Outlook 2025: Long-Term Growth Prospects Remain Intact

Note: At the time of writing, global uncertainty caused by the recent US-imposed tariffs remains elevated. As the situation continues to evolve, the long-term impacts might not be fully captured in this report, and its findings may be subject to change.

Now in its third edition, our latest Southeast Asia (SEA) Outlook highlights the region’s economic prospects in 2025. The report also offers occupiers and investors insights into key SEA markets, including Singapore, Malaysia, Indonesia, Thailand, Vietnam, and the Philippines. 

While the risk of a global economic slowdown may temper SEA’s short-term growth, the region’s demonstrated resilience and strong long-term fundamentals will continue to position it among the world’s fastest-growing economies.

SEA remains one of the fastest-growing regions globally, with gross domestic product (GDP) poised to rise by 4.8% year-over-year (YOY) in 2024, outpacing the 3.9% growth recorded in 2023.

Philippines' Economic Overview

Despite global uncertainties, the Philippine economy is expected to achieve healthy growth between 2025 and 2028, driven by structural reforms such as the implementation of the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) and the Real Property Valuation and Assessment Reform Act, which are  expected to strengthen local industries, attract foreign investments, and drive higher economic growth. Meanwhile, the anticipated further reduction in benchmark interest rate is expected to support private investment and household consumption.

Key Takeaways for Occupiers in the Philippines

• Office Sector: Despite high vacancy rates in the market, headline rents for Prime and Grade A developments in key CBDs have remained stable in the medium term.
• Retail Sector: The pandemic and post-pandemic periods have seen a significant slowdown in the delivery of new retail space supply while international retailers’ activities remain moderate due to the overall bleak global market situation. 
• Prime Logistics: Infrastructure developments that enhance logistics operations continue to drive new projects, increasing demand for sorting facilities and distribution centers amid rapid expansion of e-commerce.
• Residential Sector: Rents are expected to remain stable, while capital values are projected to rise further in 2025.