Industry Research : Cashing In On the Boom in Business Process Outsourcing Industry
The Philippine real estate market will continue to grow, largely due to the thriving Business Process Outsourcing (BPO) industry, that has boosted the demand for office space, and for residences. New business centers in Metro Manila and key provincial centers are reportedly growing up to 2015, also as a result of sustained growth of outsourcing and the call center industry.
The report by the Jones Lang LaSalle Leechiu (JLLL) said the demand is prompting developers to construct more office buildings to accommodate the booming BPO industry. Several BPOs no longer limit themselves to the central business districts of Makati and Ortigas and real estate firms are developing other areas. BPO firms have sprung up in Quezon City as well as Taguig City. JLLL, an international property services company in the Philippines, reported that "from two dominant business districts at the end of the 20th century, there are now at least 10 in Metro Manila and 10 more emerging in key Philippine cities, majority fuelled by the outsourcing and call center industry which was valued as a $9 billion industry in 2010."
The Philippines remains a top destination for the BPO industry due to its lower operational and labor costs, and its English-speaking young graduates. JLLL reported that over 50 percent of all office space leased in the Philippines since 2006 has been taken up by the bourgeoning industry which generates demand for an average 300,000 to 360,000 square meters of office space annually.
New office towers have risen in Quezon City, occupied by employees of outsourcing and call center firms. The same is true with Muntinlupa City. Many top BPO firms expanded beyond Metro Manila to cities like Baguio, Sta. Rosa in Laguna, Lipa in Batangas, Iloilo, Dumaguete, Cagayan de Oro, Cebu City, and Davao to tap the services of fresh labor pools. JLLL said the BPO industry will continue to provide impetus to the office sector up to 2015.
It is expected that for 2012 and beyond, the property sector will continue to cash in on the boom in the business process outsourcing industry, as multinational firms, several of which are in the call center industry, remain bullish about doing business in the Philippines.
Posted by Veronica Silva Cusi, news correspondent
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Published: Monday, March 5, 2012