The Philippines office market registered positive growth as demand rose by 22.5% in the first quarter of 2021 on account of optimism on post-pandemic economic recovery, according to Leechiu Property Consultants (LPC).
The office demand reached 109,000 square meters (sqm) in the January to March period from 89,000 sqm in the fourth quarter of 2020. LPC also projects that the Corporate Recovery and Tax Incentives for Enterprises (CREATE) law and the Covid-19 vaccine rollout will improve investor sentiments in the next few months.
The information technology and business process management (IT-BPM) remains the single largest driver of office demand during the first quarter as the demand from Philippine offshore gaming operators’ activity (POGOs) flatlined due to the pandemic.
In the first quarter of 2021, the IT-BPM industry accounted for the largest single take-up at 33,000 sqm followed by e-commerce at 19,000 sqm, which more than tripled its take-up from the fourth-quarter level of 6,000 sqm. Apart from the IT-BPM sector, traditional companies and online retail companies have led the growth for the last two three quarters.
LPC reported active office requirements of 266,000 sqm from firms looking to transact within the year. Of the total, IT-BPMs account for 33%; POGOs 12% and retail firms, 7%. POGOs started showing interest once again with a live requirement of 31,000 sqm. However, it is still early to tell if POGOs will remain committed to the country due to issues such as the changes in the POGO tax regime and the crackdown by regulators in mainland China.
(Source: Philippine News Agency)