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BPO companies turning to Cebu –  property consultant CBRE


Business process outsourcing (BPO) companies are slowly shifting toward Cebu City, given the lower cost of doing business in the Central Philippine area, property consultancy CBRE Philippines said. 
 
“Lately, some new BPO entrants are identifying Cebu as the primary location for their headquarters and jump off to expand from there,” CBRE said in report e-mailed late Monday. 
 
“Cebu is a strong alternative to Manila because of lower costs,” it added. 
 
In a text message to GMA News Online, Cebu Chamber of Commerce and Industry President Lito Maderazo said business groups and government have been making efforts to make the city “more competitive vis–à–vis Manila” by making it more “livable and cost competitive.”
 
CBRE estimates showed office space rent in Metro Cebu ranges from P350 to P750 per square meter, compared with P430 to P1,300 in Metro Manila. 
 
The property firm also noted increasing supply of leasable office space in Cebu, projected at 222,368 sqm by 2015. 
 
Daily wages in Metro Cebu are also considerably lower at P282 to P327 than P419 to P456 in Metro Manila, CBRE said, but noted “there is no significant” disparity in entry level pay for BPO workers in between the two cities. 
 
However, utilities costs, which are typically more inexpensive outside the capital, comprise a chunk of firms operational cost other than rent and salaries.
 
The price of electricity is 11 percent higher – and water 8 percent more – in Manila, said CBRE. 
 
With the “exponential exapansion of the BPO industry across business districts  in Manila, provinces with great labor potential are becoming viable alternative locations,” the property consultant noted.
 
Central Visayas is arguably the business center outside the national capital region. It produced 43,863 fresh graduates last school year, compared with 128,432 in Metro Manila, according to CBRE estimates. 
 
The employment outlook is positive, with international companies locating in Metro Cebu, the property consultant said. 
 
Outsourcing companies like JP Morgan and Chase, Aegis, Accenture, Teletech, IBM and Convergys have established centers in Cebu City IT park. 
 
In 2012, Central Visayas earned $516 million in BPO revenues with over 100,000 outsourced workers , data from the region's development council showed. – VS, GMA News
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