Should you sell or rent out a Makati commercial space? These slides can help you decide if you should sell or rent your property. Contact KMC MAG Group for more information.

1. How to Deal with a Makati
Commercial Space: Rent
Out or Sell?

2. What is the current value of your Makati
commercial space for rent?

3. If it is HIGHER...
SELL the
commercial space.
● Liquidate your asset
and set it aside for
other projects or
business investments
● Lowers the chances of
selling your property
at a less price

4. If it is LOWER...
RENT OUT the
commercial space.
● Wait for the property
value to come up
● Make sure you are
ready to take on
landlord
responsibilities and
risks

5. What is your investment yield?

6. A. To compute, find the following values:
● Expected monthly rent (base it on existing rates for a
Makati commercial for rent)
● Annual taxes
● Other annual costs
● Monthly fees
● Likely sales price
● Estimated annual income

7. B. Find the operating income.
Step 1. Get expected rental income.
Step 2. Find vacancy and credit loss.
Step 3. Add the following: Annual taxes, Maintenance
costs, Other annual costs, and Monthly fees and
subtract
Step 4. Subtract answer from step 3 from answer in
step 2.

8. Sample:
Step 1. Annual Rent:
PHP7000 (7000*12)= PHP84000
Step 2. Estimate vacancy and credit loss. (average is 3 to 4%)
PHP84000*(.036)=PHP3024
Step 3. PHP84000-PHP3024=PHP 80976
Step 4. PHP25000=NET of Annual taxes, Maintenance costs,
Other annual costs, and Monthly fees
PHP80976-PHP25000=PHP55976

9. C. Divide operating income by asset price.
Sample:
Income: PHP55976
Asset Price: 1,000,000
PHP 56876/1000000=5.60%
*Note: If yield is lower than 5.7% you should consider
selling.

10. Consult a real estate professional
regarding local market trends, average
rental rates, and the time it would take to
find a qualified tenant.

11. For more information about selling or renting
out a Makati commercial space, contact us.