BPO sector to sustain demand for properties

The steady expansion of the business process outsourcing (BPO) industry is supporting the demand for office and residential spaces, Jones Lang LaSalle (JLL), the property consultancy firm, said in a media briefing Thursday.

 

The number of full-time BPO workers is expected to reach 1.3 million this year, translating to 900 square meters of office space requirement, said JLL local Director Phillip Anonuevo, citing data from the IT and Business Process Association of the Philippines (ITBPAP).

 

About 506,574 sqm or 68 percent of the 745,390 sqm of available office space for 2015 have already been leased, with about 63 percent of the demand coming from the BPO industry.  

 

The demand for office spaces could also expand to what the consultancy firm called “new wave cities” like Tuguegarao, Antipolo, Kalibo, Iloilo, Bohol, Davao, Puerto Princesa, Cavite, Balanga, Subic and Clark.

 

"Call enters go to where people are,” Anonuevo said. 

 

The BPO industry, along with an expected increase in remittances, also supports a sustained demand for residential units, said JLL head of research Claro Cordero.

 

The existing supply of residential units in Metro Manila totaled 216,830 units. Most of the condominiums are within or near the business districts where most companies are also located. 

 

Cordero said revenues from the BPO industry could grow by 15 percent annually from 2015 to 2017. The sector’s revenues have grown 22 percent annually in the last four years. 

 

The amount of remittances from overseas Filipinos is expected to increase by 5 percent each year until 2017. The annual growth rate of remittances averaged 7 percent from 2010 to 2014.

 

“We are not looking at any sign of slowdown in OFW remittances,” said Cordero.

 

However, conflicts in the Middle East and the debt crisis gripping Greece could result in a decline in the population of Filipino workers in Europe, lower remittances and spending income, the JLL official noted.

 

Tighter lending controls for banks may also curtail the demand for residential space while inefficient infrastructure systems and delayed public-private partnership projects may stun the growth the property sector, Cordero added. – VS, GMA News