BPO, gaming firms fueling demand for Metro Manila office space

MANILA, Philippines — Business process outsourcing (BPO) firms and online gaming companies are driving up demand for office space in Metro Manila, leading to record growth and high occupancy rates, an official of a  leading property consulting firm said.

JLL regional director and head of project leasing Sheila Lobien said high demand for office space from last year has caused land and property values, as well as rental rates, to peak.

She said the main driver of the office market is still the BPO industry which accounts for 80 to 90 percent of office demand. BPOs accounted for 600,000 square meters in office space, up from 500,000 sqm in 2016.

Also credited for the surge in office space rentals are Chinese investors coming in droves to put their money into the online gaming industry, she added.

Leading the race for most coveted office areas is Makati, followed by Bonifacio Global City whose main selling point is the good work-play area.  The Bay Area is becoming the go-to site of gaming investors while Alabang has become a preference due to the improved road infrastructure to and from the area.

Quezon City is enjoying the biggest BPO population owing to its large number of residential areas and universities.  Townships are also booming in Quezon City – where pocket spaces, retail, mall and schools are being built in one site to ease the population’s everyday commute.

With the influx of investments in need of office spaces comes the creation of more job opportunities for Filipinos who have been lauded in many parts of the globe.  According to Lobien, the Philippine population is very young, very skilled and proficient in the English language.  Labor costs are also very affordable.

She pointed out that talent is never lacking in the Filipino, even in Metro Manila’s outskirts like Bulacan, Laguna, Cavite and Clark in Pampanga which are being eyed intensively by investors looking to expand their operations outside the metropolis.

Lobien explained that aside from the impressive skills of locals, cheaper labor cost as well as lower rental rates have been the main drivers for businesses to set up site in Metro Manila’s outlying areas.

She said Clark in particular has seen the rise of many industrial sites, office buildings, hotels and residential developments owing to its accessibility via land, air and sea. She added that Cebu has what it takes also to become the next powerhouse in terms of location for the BPO industry.

Lobien said the infrastructure slated by the current administration’s Build Build Build program will further make the country even more competitive as a global BPO destination.

“The railway planned from Tutuban going northwards will definitely make the Bulacan-Clark-Subic corridor in the North a natural BPO destination. Cebu, owing to its large English-speaking local population, presence of an enhanced international airport and seaports and the planned infrastructure to connect it with the other islands in the Visayas will definitely become a hotter destination for BPO locators,” Lobien said.