Old buildings seek PEZA coverage to lure IT firms

REPORT FROM BUSINESSWORLD Property developers have been keen on securing accreditation from the Philippine Economic Zone Authority as information technology (IT) hubs in a bid to lure more tenants for their existing, fully developed buildings. Data collated from the Philippine Economic Zone Authority (PEZA) showed that most of the IT buildings approved in February and March are not new, but rather are old buildings. Of the total eight fully-developed buildings registered by PEZA in the past two months, only three buildings are located in Metro Manila, all in Quezon City, and the remaining five are located in the Visayas. Newly-registered buildings in Quezon City are the 20,971-square meter Vibaltech Tower of SD Publications Inc., the 40,382-square meter Ali Mall IT Building and the 28,452-square meter Manhattan Plaza Area, both located inside the Araneta Center and developedby Araneta Center Inc. (ACI). Eugenio C. Barcelona, ACI leasing manager, said in a previous interview that the flagship company of the Araneta family plans to convert a portion of the top floor of Ali Mall, which now hosts cinemas, into office space to meet demand from the industry. These will add to the four-floor office facility at Gateway Mall, which is now fully occupied by BPO firm Accenture Philippines. Three of the five newly approved buildings in the provinces are located in Bacolod City in Negros Occidental, namely: the 20,000-square meter Lopue’s East IT Center developed by Marketing One Unlimited Inc., the 10,874-square meter De La Rama Center of De La Rama Brothers Development Corp., and the 2,284-square meter Monfort IT Building of Monfort Motor Center Corp. The remaining two buildings approved in the provinces are the 55,000-square meter Island City Mall IT Building in Tagbilaran City by Alturas Supermarket Corporation and the 2,284-square meter Oakridge Information Technology Center in Mandaue City of Oakridge Realty Dev’t Corp. This implies that more business process outsourcing (BPO) companies now, particularly call centers, are considering provincial locations, said Richard T. Raymundo, Colliers International Philippines, Inc. director for the research and consultancy, in a telephone interview. "BPOs would look at traditional areas in Metro Manila first. But due to constraints in space and labor pool, a number of companies are now moving to the provinces," he said. Despite the mushrooming of PEZA-accredited buildings, Mr. Raymundo he does not foresee a looming glut in office supply as demand for office space continues to grow. Industry group Business Processing Association of the Philippines (BPA/P) said that for this year alone, at least big six call center companies will invest in areas outside Metro Manila. This, as Metro Manila is now choking from five years of relentless growth, from some 20 call center companies in 2000 increasing to 105 locators at present. About 80% of the total 105 call center locators are in Metro Manila. BPA/P said the prospective investments from the six and other smaller companies will be spread out in emerging BPO destinations, particularly those areas identified last year by the Trade department. In the list are Zamboanga, General Santos, Cagayan de Oro, Leyte, Bacolod, Bohol, Cebu, Naga, Bataan, Bulacan, Pangasinan, Camarines Sur, Iloilo, Davao, Pampanga and Baguio City. The Trade department said these areas have met industry requirements, particularly labor pool supply and infrastructure. – Maricel E. Estavillo/BusinessWorld