--- title: "Flex vs Traditional Office Lease in Metro Manila: What Each Really Costs" description: Compare the total cost of a traditional office lease and a flex office in Metro Manila, with a worked 200 sqm BGC example, tax and deposit math. image: https://blog.flyspaces.com/hubfs/flyspaces-landing-images/makati-open-workstations.jpg --- [![spacesasia-logo](https://blog.flyspaces.com/hs-fs/hubfs/SpacesAsia%20-%20June%202019/spacesasia-logo.png?width=260&name=spacesasia-logo.png "spacesasia-logo")](https://blog.flyspaces.com/) - [Home](https://flyspaces.com/) - Navigate - [Flexible Workspaces](https://blog.flyspaces.com/tag/flexible-workspaces#blog-nav) - [News and Events](https://blog.flyspaces.com/tag/news-and-events#blog-nav) - [Industry Insights](https://blog.flyspaces.com/tag/industry-insights#blog-nav) - [City Guide](https://blog.flyspaces.com/tag/city-guide#blog-nav) - [Case Studies](https://blog.flyspaces.com/tag/case-studies#blog-nav) - Connect - [Contact Us](https://flyspaces.com/contact-us) - [Subscribe](https://flyspaces.us14.list-manage.com/subscribe/post?u=0b15b0bb7a66ae626f3388eb9&id=f72d186210) - Share : 2 October 2026 [Listerlynn Joy Garingo - De La Serna](https://blog.flyspaces.com/author/joy-garingo-delaserna) # Flex vs Traditional Office Lease in Metro Manila: What Each Really Costs The rent per square meter in a listing is only the first line of what you pay. This guide uses one example, a 200 sqm office in Bonifacio Global City (BGC), to show what a traditional lease costs each month. It also shows how to compare that against a flexible (serviced) office quote on equal terms. ### What a traditional lease adds on top of base rent GRID Property Ventures reports that Grade A space in BGC rents for about ₱1,100 to ₱1,500 per sqm per month in 2026, and that building service charges add about ₱150 to ₱250 per sqm ([GRID, 2026 BGC leasing costs](https://grid.com.ph/blogs/bgc-cost-of-leasing)). Those service charges are called CUSA, short for common use service area charges. They cover shared areas such as the lobby, security and building maintenance. Parking is usually billed separately. Here is a monthly example using mid-range figures. These are our own assumptions for illustration, not a quote. | Item | Calculation | Amount (PHP) | | --- | --- | --- | | Base rent | 200 sqm × ₱1,300 | 260,000 | | CUSA | 200 sqm × ₱200 | 40,000 | | Parking | 2 slots × ₱6,500 | 13,000 | | Subtotal | | 313,000 | | Add 12% VAT | 313,000 × 12% | 37,560 | | Invoice total | | 350,560 | The invoice total is about 35% above base rent (350,560 ÷ 260,000). If your company is VAT-registered and can claim the VAT back as input tax, the gap is closer to 20% (313,000 ÷ 260,000). Ask your accountant which case applies to you. Parking rates and the number of slots vary by building, so check your own lease. ### The two taxes on rent, in plain terms VAT. Leasing office space is subject to 12% value-added tax when the landlord is VAT-registered. The landlord adds it to your invoice. See [Respicio & Co. on VAT and withholding on rent](https://www.respicio.ph/commentaries/do-lessors-need-to-pay-withholding-tax-aside-from-vat-in-the-philippines). Withholding tax. If your company is required to act as a withholding agent, you must hold back 5% of the rent (not counting VAT) and pay it to the Bureau of Internal Revenue (BIR) on the landlord's behalf. You then give the landlord a BIR Form 2307 certificate. The base for this tax can include CUSA, depending on how your lease bills it ([Respicio & Co. on computing withholding tax on rent](https://www.respicio.ph/commentaries/how-to-compute-withholding-tax-on-rental-income-in-the-philippines)). In our example, the 5% applies to ₱300,000 (rent plus CUSA), so ₱15,000 goes to the BIR and ₱335,560 goes to the landlord. You still pay the same ₱350,560 in total. Withholding changes who receives the money, not how much you spend. It does add monthly paperwork: the remittance return, the certificates and the record keeping. One point from older guides is now out of date. Until 2023, failing to withhold could cost you the income tax deduction for the whole rent expense. The Ease of Paying Taxes (EOPT) Act, in effect since 2024, repealed that rule ([KPMG Philippines, 2024](https://kpmg.com/ph/en/home/insights/2024/08/clarifications-on-the-revenue-regulations-implementing-the-eopt-act.html)). You can still be assessed the unpaid tax plus penalties. The EOPT Act also lowered penalty rates for smaller taxpayers ([Grant Thornton Philippines, EOPT summary](https://www.grantthornton.com.ph/contentassets/2208a706d6c743e0a9a6c4f6d89d81b1/eopt-act-comparative-summary.pdf)). The rules changed recently, so have your tax adviser confirm how they apply to your company. ### Cash you need before moving in Many traditional landlords ask for three months of advance rent plus a three-month security deposit. This is often called "3+3". Terms vary by building, so check the lease. | Item | Calculation | Amount (PHP) | | --- | --- | --- | | 3 months advance rent | 3 × 260,000 | 780,000 | | VAT on advance rent | 780,000 × 12% | 93,600 | | 3 months security deposit | 3 × 260,000 | 780,000 | | Total at signing | | 1,653,600 | This uses base rent only. If your lease also requires advance CUSA, the total will be higher. The deposit comes back at the end of the lease, but only if the landlord has no deductions, so treat it as cash that is tied up and not as spending. ### Fit-out and move-out costs A bare or warm shell office needs partitions, ceilings, power, cabling and furniture before anyone can work in it. Some leases also require you to restore the space to its original condition when you leave, which is called reinstatement. We are not quoting a per-sqm fit-out figure here, because regional averages differ a lot from real Manila quotes. Get a written quote from a local contractor and use this formula: Fit-out budget = floor area in sqm × contractor's quoted cost per sqm + reinstatement estimate On a three-year horizon this is often the largest single item, so quote it before you compare anything else. ### How flex pricing differs A serviced or flexible office usually bundles rent, building charges, utilities, internet, reception and cleaning into one monthly fee. The space is already fitted, and deposits are typically smaller than in a traditional lease. The exact numbers depend on the operator, the building and the term. See [FlySpaces on what a serviced office includes](https://blog.flyspaces.com/5-benefits-of-fully-serviced-office-space?hsLang=en-us) and browse [serviced offices in Manila](https://flyspaces.com/manila/serviced-office) for current listings. Flex is not always cheaper. A short term can cost more per seat than a longer one, and a flat monthly fee for a large team can exceed what a long lease would cost per seat. The only way to know is to compare the same period on the same basis. Ask each operator for: 1. The all-in monthly price, and whether VAT is included. 2. The term and the notice period. 3. The deposit and when it is returned. 4. What is excluded, such as meeting rooms, parking and after-hours air conditioning. 5. Any fee to add or remove desks. ### An accounting note Under PFRS 16, the Philippine version of the international leasing standard, leases longer than 12 months generally go on the balance sheet as an asset and a liability. Leases of 12 months or less can qualify for a short-term exemption ([IFRS Foundation, IFRS 16 Leases](https://www.ifrs.org/issued-standards/list-of-standards/ifrs-16-leases/)). A flex agreement on a 24-month term would not qualify for that exemption. Some flex contracts are service agreements and not leases at all, so ask your auditor how yours is treated. ### Which one fits Flex tends to suit teams whose headcount may change in the next one to three years, or companies that want to keep cash free for hiring. A traditional lease tends to suit a stable team that expects to stay five years or more, because the fit-out cost is spread over more years. Some companies lease a smaller traditional space for their core team and rent flex space for project teams or growth. ### A short checklist before you decide 1. Forecast headcount for the next 36 months, with a low and a high case. 2. Build the traditional lease cost using the table above, with your own rates and your VAT position. 3. Get a contractor quote for fit-out and reinstatement. 4. Collect at least three flex quotes on the same basis, using the five questions above. 5. Compare the total cash out over your real time horizon, including the cash you must pay at signing. If you want help with step 4, the FlySpaces team can arrange viewings and compare quotes from several operators for you. Start from the [Manila serviced office listings](https://flyspaces.com/manila/serviced-office). Tags: [Flexible Office Space](https://blog.flyspaces.com/tag/flexible-office-space), [office for rent](https://blog.flyspaces.com/tag/office-for-rent) ![](https://blog.flyspaces.com/hubfs/SpacesAsia%20-%20June%202019/author-img.png) ##### [Listerlynn Joy Garingo - De La Serna](https://blog.flyspaces.com/author/joy-garingo-delaserna) Joy Garingo - De La Serna is a Filipino business executive specializing in the real estate, flexible workspace, and Employer of Record (EOR) sectors within the Asia-Pacific (APAC) region. She is involved in creative ventures and community-centric workspace environments that support local startups, founders, and generational shifts in hybrid work styles. Comments (0) [Subscribe via e-mail](https://blog.flyspaces.com/flex-vs-traditional-office-lease-in-metro-manila-what-each-really-costs#pop-up) ## Subscribe via e-mail [Previous](https://blog.flyspaces.com/why-modern-teams-are-prioritizing-secure-workspaces?hsLang=en-us) Why Modern Teams Are Prioritizing Secure Workspaces [Next](https://blog.flyspaces.com/how-much-does-an-office-fit-out-cost-in-metro-manila-2026?hsLang=en-us) How much does an office fit-out cost in Metro Manila? (2026) ## You Might Also Like ###### [The Hidden Costs of a Traditional Office Lease in Metro Manila](https://blog.flyspaces.com/the-hidden-costs-of-a-traditional-office-lease-in-metro-manila?hsLang=en-us) ###### [Flex or Traditional Lease: How to Decide When Your Team is Growing](https://blog.flyspaces.com/flex-or-traditional-lease-how-to-decide-when-your-team-is-growing?hsLang=en-us) ###### [How much does an office fit-out cost in Metro Manila? (2026)](https://blog.flyspaces.com/how-much-does-an-office-fit-out-cost-in-metro-manila-2026?hsLang=en-us) ###### [Signs It's Time to Move into an Office Space in Mandaue: Tracking Your Daily Workplace Frustrations](https://blog.flyspaces.com/its-time-to-move-to-office-space-in-mandaue?hsLang=en-us) ###### [A Guide to Returning to the Workplace in the New Normal](https://blog.flyspaces.com/guide-to-returning-to-the-workplace-in-the-new-normal?hsLang=en-us) ###### [This is What Offices Will Look Like When They Reopen](https://blog.flyspaces.com/this-is-what-offices-will-look-like-when-they-reopen?hsLang=en-us) ###### [FlySpaces by the Numbers: The Workspace Platform that Keeps on Growing](https://blog.flyspaces.com/flyspaces-by-the-numbers-the-workspace-platform-that-keeps-on-growing?hsLang=en-us) ###### [The Differences Between a Flexible Workspace and Traditional Office](https://blog.flyspaces.com/difference-between-flexible-workspace-and-traditional-office?hsLang=en-us) ###### [CASE STUDY: How Flexibility Helps Fast-Growing Companies Like Zalora](https://blog.flyspaces.com/case-study-how-flexibility-helps-fast-growing-companies-like-zalora?hsLang=en-us) Copyright © 2020 FlySpaces Inc. All rights reserved. go to [flyspaces.com](https://flyspaces.com/)