IT-BPM fuels office space demand in Philippine cities
MANILA, PHILIPPINES — The Information Technology and Business Process Management (IT-BPM) sector is driving demand for office space in regional cities across the Philippines, according to real estate services firm KMC Savills.
During a recent briefing, KMC Savills reported the continued expansion of IT-BPM companies such as Concentrix + Webhelp, Teleperformance, and Accenture in cities like Cebu, Clark, Davao, Iloilo, and Bacolod.
KMC Savills Executive Director John Corpus attributed this growth to third-party business process outsourcing firms entering these regional markets.
While IT-BPM dominates the office market, KMC Savills Chief Operating Officer Cha Carbonell said other industries like e-commerce and logistics also lease office space in regional hubs to establish satellite offices.
Managing Director Michael McCullough added that provincial areas have seen better performance than Metro Manila recently, as companies relocated top employees to the countryside during the pandemic.
“Companies want to go where the best employees are, so a lot of people during the pandemic went and returned to the provinces, and so that’s where the companies wanted to move back to,” he stated.
The report also forecasts Cebu’s office vacancy rate to return to pre-pandemic levels by 2025, led by Cebu Business Park and Cebu IT Park. Davao, Iloilo, and Bacolod also saw falling vacancy rates and increased leasing activity.
On the other hand, Metro Clark’s office market is expected to continue struggling with high vacancy rates as Philippine Offshore Gaming Operators (POGOs) leave the country.
Overall, growing demand from IT-BPM companies drives office space absorption in regional cities and provides opportunities for real estate developers to build new commercial projects in the Philippines.
