NCR has highest net absorption in office space in Asia-Pacific, says firm

Metro Manila has ranked the highest in the Asia-Pacific region in terms of office space take-up on strong demand from business process outsourcing (BPO) companies, officials of global real estate services firm Cushman & Wakefield said Wednesday.

The metro witnessed the highest net absorption in the office market year-to-date across cities in the region due to the consistent and healthy demand driven by the IT-BPO sector, Cushman & Wakefield Philippines general manager Joe Curran said at a briefing in Makati City.

According to Cushman & Wakefield research, office market absorption in Metro Manila reached approximately 356,092 square meters, outperforming the rest of the markets in the region including Mumbai, Bengaluru, Chennai, Guangzhou, Pune, Chengdu, Shenzhen, Kuala Lumpur and Singapore.

"The office sector in Metro Manila is witnessing a positive momentum due to strengthening economic conditions and improved business sentiments, as the stable growth in the BPO sector continue to fuel office expansions," Curran said.

The study showed Taguig City had the highest office space take-up with 59 percent, followed by Makati City at 29 percent.

Cushman & Wakefield Asia Pacific chief executive Sanjay Verma said companies continuously expand in the Philippines due to a number of reasons.

"Drivers to go to the Philippines are the English-speaking workforce, improving infrastructure and scalability, in addition to low rates," he said.

Next-wave cities

Apart from main business districts in Metro Manila, the Philippines also has "next-wave cities" that have great potential for expansion for BPOs.

"With the very low vacancy on phenomenal demand will drive companies to expand across the Philippines. There's huge potential in these Tier 2 cities or what we call next-wave cities," Curran said.

These cities include Cebu, Davao, Cagayan de Oro, Batangas, Bacolod, Iloilo, Naga and Baguio.

Verma said companies go to these next wave cities not because the real estate is cheap but because they can expand in these areas.

"The highest fundamental of the economy is availability of English-speaking workforce which is scalable...the question is will growth take place where there is employable workforce," he noted. — BM, GMA News