How the 2025 Philippine Elections Could Affect Property and Facilities Management: Regulatory and Market Outlook

Introduction

The 2025 Philippine midterm elections, scheduled for May 12, 2025, represent a pivotal moment in the nation's political landscape. These elections will determine the composition of the Senate (with 12 seats up for grabs), the House of Representatives (including party-list seats), and numerous local government positions, including governors, mayors, and councilors. As a midterm contest under the administration of President Ferdinand "Bongbong" Marcos Jr., who assumed office in 2022, the outcomes could either reinforce the current executive's agenda or introduce checks and balances through a more opposition-leaning Congress.

In the context of property and facilities management—a sector encompassing real estate development, building operations, maintenance, and related services—these elections hold significant implications. Property management involves the oversight of residential, commercial, and industrial assets, while facilities management focuses on operational efficiency, compliance, and sustainability. Both are heavily influenced by regulatory frameworks under laws such as the Civil Code, the Property Registration Decree (Presidential Decree No. 1529), the National Building Code (Republic Act No. 6541, as amended), and environmental statutes like the Philippine Environmental Impact Statement System (Presidential Decree No. 1586).

This article examines the potential regulatory shifts and market dynamics arising from the 2025 elections, drawing on the Philippine legal framework and historical precedents from past electoral cycles. It analyzes how election outcomes could alter policies on land use, taxation, foreign investment, infrastructure, and sustainability, ultimately shaping the outlook for property owners, developers, managers, and service providers. While speculative in nature due to the unpredictable electoral process, the discussion is grounded in constitutional principles, existing statutes, and observed patterns in Philippine governance.

Political Context and Potential Outcomes

The Philippine Constitution (1987) establishes a presidential system with a bicameral Congress, where midterms serve as a referendum on the sitting administration. President Marcos Jr.'s administration has prioritized economic recovery post-COVID-19, infrastructure development through the "Build Better More" program (an extension of the Duterte-era "Build, Build, Build"), and attracting foreign direct investment (FDI) via amendments to the Public Service Act (Republic Act No. 11659), the Foreign Investments Act (Republic Act No. 11647), and the Retail Trade Liberalization Act (Republic Act No. 11595). These reforms have eased restrictions on foreign ownership in certain sectors, indirectly benefiting property markets by encouraging commercial real estate investments.

Key electoral scenarios include:

Administration Dominance: If pro-Marcos coalitions (e.g., UniTeam or similar alliances) secure a majority in the Senate and House, policy continuity is likely. This could accelerate infrastructure projects, boosting demand for property development and facilities management in logistics hubs, industrial parks, and urban centers.
Opposition Gains: A stronger showing by opposition figures or coalitions (e.g., those aligned with liberal or progressive groups) might lead to increased scrutiny of executive policies, potentially stalling large-scale projects or introducing reforms focused on social equity, such as affordable housing mandates under the Urban Development and Housing Act (Republic Act No. 7279).
Fragmented Results: A divided Congress could result in legislative gridlock, delaying reforms and creating uncertainty for investors in the property sector.

Local elections are equally critical, as governors and mayors control zoning, building permits, and local ordinances under the Local Government Code (Republic Act No. 7160). Shifts in local leadership could directly impact property management practices, such as enforcement of fire safety codes or waste management regulations.

Regulatory Outlook: Potential Changes and Legal Implications

Elections often catalyze regulatory evolution, as new legislators propose bills aligned with their platforms. In the property and facilities management sphere, several areas stand out:

1. Land Use and Zoning Regulations

Under the Comprehensive Land Use Plan (CLUP) framework mandated by the Local Government Code, local governments dictate zoning, which affects property valuation and development. Election outcomes could influence:

Urban Expansion Policies: Pro-development administrations might expedite rezoning for mixed-use developments, benefiting facilities managers handling commercial spaces. Conversely, environmentally focused winners could impose stricter limits on conversions of agricultural land, per the Comprehensive Agrarian Reform Law (Republic Act No. 6657, as amended), potentially reducing available sites for new builds.
Building Standards: Amendments to the National Building Code could emerge, emphasizing resilience against climate change (e.g., typhoons and earthquakes). Facilities managers might face new compliance requirements for seismic retrofitting or green building certifications under the Philippine Green Building Code (Department of Public Works and Highways Order No. 41, series of 2015).

Legal Precedent: Post-2010 elections, the Aquino administration's focus on disaster risk reduction led to enhanced enforcement of building codes, increasing costs for property maintenance but improving long-term asset value.

2. Taxation and Fiscal Policies

Property taxes are governed by the Real Property Taxation Code (Presidential Decree No. 464, as amended by Republic Act No. 7160). Midterm results could prompt:

Tax Reforms: An administration-friendly Congress might extend tax incentives under the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act (Republic Act No. 11534), reducing effective rates for real estate investment trusts (REITs) and encouraging FDI in commercial properties. Opposition-led reforms could introduce progressive taxation on idle lands to discourage speculation, per proposals in past sessions.
Impact on Facilities Management: Higher taxes could strain operational budgets, prompting outsourcing to specialized firms for cost efficiency. Conversely, incentives might spur renovations, increasing demand for energy-efficient upgrades.

Constitutional Considerations: Any tax changes must adhere to Article VI, Section 28 of the Constitution, ensuring uniformity and equity, which could lead to legal challenges if perceived as discriminatory.

3. Foreign Ownership and Investment Laws

The 1987 Constitution limits land ownership to Filipinos, but recent amendments allow fuller foreign participation in public utilities and retail. Post-2025, further liberalization could occur:

REIT and Condominium Markets: Enhanced foreign access might boost high-end residential and office spaces, requiring facilities managers to adapt to international standards (e.g., LEED certification).
Risks: Nationalist platforms could reverse gains, reinstating barriers and affecting market liquidity.

Case Law: Supreme Court rulings like PDEA v. Philippine Realty (hypothetical based on similar cases) underscore the need for compliance with ownership restrictions, potentially leading to disputes in joint ventures.

4. Environmental and Sustainability Regulations

The Philippine Clean Air Act (Republic Act No. 8749), Clean Water Act (Republic Act No. 9275), and Climate Change Act (Republic Act No. 9729) impose duties on property managers for pollution control and energy audits.

Election-Driven Shifts: Green-leaning victors might mandate carbon footprint reporting for large facilities, increasing operational costs but opening markets for sustainable management services.
Facilities Management Adaptation: This could involve integrating IoT for energy monitoring or complying with waste segregation under local ordinances.

Historical Insight: After the 2016 elections, the Duterte administration's mining crackdown indirectly affected industrial property values, illustrating how policy pivots ripple through sectors.

5. Labor and Contractual Frameworks

Facilities management relies on labor under the Labor Code (Presidential Decree No. 442, as amended). Electoral promises on wage hikes or contractualization bans (e.g., via the Security of Tenure Bill) could raise costs for maintenance staff, prompting shifts to automated systems.

Market Outlook: Economic and Operational Impacts

Beyond regulations, elections influence market sentiment:

1. Investor Confidence and Property Values

Elections typically induce pre-vote caution, with transaction volumes dipping 10-20% in historical cycles (based on patterns from 2013 and 2019 midterms). Post-election clarity could spark rebounds:

Bullish Scenario: Administration wins might sustain GDP growth targets (6-7% annually), driving demand for office spaces in IT-BPM sectors and residential units amid urbanization.
Bearish Scenario: Political instability could deter FDI, softening rental yields and increasing vacancy rates in commercial properties.

2. Demand for Facilities Management Services

The sector, valued at billions in pesos, includes outsourcing giants like those in the Philippine Association of Building Administrators. Potential growth areas:

Infrastructure Boom: Continued public-private partnerships (PPPs) under Republic Act No. 6957 (as amended) could create opportunities for managing new airports, roads, and hospitals.
Digital Transformation: Post-election policies on digital economy (e.g., via the Innovative Startup Act, Republic Act No. 11337) might accelerate smart building adoption, benefiting tech-savvy managers.
Risks: Economic slowdowns from policy shifts could lead to deferred maintenance, heightening liability under tort provisions in the Civil Code (Articles 2176-2194).

3. Regional Variations

Metro Manila and growth areas like Cebu and Davao may see amplified effects due to concentrated investments, while rural areas grapple with land reform issues.

Challenges and Mitigation Strategies

Property and facilities managers should prepare for volatility by:

Conducting legal due diligence on assets.
Diversifying portfolios across sectors.
Engaging in advocacy through industry groups like the Philippine Constructors Association.

Legal remedies, such as petitions for certiorari under Rule 65 of the Rules of Court, remain available for challenging arbitrary regulations.

Conclusion

The 2025 Philippine elections could profoundly shape the property and facilities management landscape through regulatory continuity or change, impacting everything from zoning to sustainability mandates. While an administration sweep promises stability and growth, opposition advances might prioritize equity and environmental safeguards, potentially at the cost of short-term market disruptions. Stakeholders must monitor developments closely, leveraging the robust Philippine legal system to navigate uncertainties. Ultimately, the sector's resilience will depend on adaptive strategies aligned with national priorities, ensuring sustained value creation in a dynamic post-election environment.