MANILA, Philippines - Demand for
office space in the country is expected to hit a fresh record high this year,
driven by the continuous expansion of business process outsourcing (BPO) firms,
a property research firm said.
Demand is forecast to reach 400,000
square meters (sqm) of new office space, particularly for BPO operations, said
Shiela Lobien, director and head of project leasing of Jones Lang Lasalle Leechiu
(JLLL).
“It is a record high. For the past
five years, it is only 300,000 sqm every year and last year we saw 360,000 sqm
and it is a jump already,” Lobien said.
The global property consultancy firm
said foreign firms are continuously expanding in the Philippines given its
competitiveness. As of last year, there are around 250 contact centers in the
country.
“Philippine talent still one of the
best in the world. As long as we can produce good talent, companies will
continue to come to the Philippines,” said Donald R. Felbaum, managing director
of business development firm Optel and a board of director of the American
Chamber of Commerce of the Philippines.
The labor cost in the Philippines is
competitive compared with BPO giant India, Felbaum said, adding that local
property firms are producing new office space in good locations.
For 2011 to 2013, JLLL earlier said
400,000 to 500,000 sqm of office space will be built annually in Metro Manila
business districts in anticipation of the sustained influx of multinational
firms.
Specifically, Lobien said the
sprawling Bonifacio Global City in Taguig will host the bulk of new buildings
that will be completed next year.
“In Fort Bonifacio, there are a lot of
buildings coming up especially for next year. New stocks are coming in that
area,” Lobien said.
For instance, the 28-story Net Lima of
the Net Group, will offer around 55,000 sqm of gross leasing space. It is
located adjacent to the future headquarters of the Philippine Stock Exchange
and Shangri-La at The Fort that is already under construction, and several
banks.
Lobien said property firms that want
to ride the BPO wave should start building new office space.
By 2015, supply will decline while
demand continues to pick up, resulting in higher rental costs, Lobien said.
The BPO sector targets $13 billion in
revenues this year, from $10.9 billion last year, data from the Business
Processing Association of the Philippines showed.
Global demand for BPO services is
projected to double in the next few years, with revenues expected to reach $25
billion by 2016.
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