Online gaming industry returns, boosts demand for office space
The online gaming industry resumed its robust expansion in the Philippines, boosting takeup of office space and residential units, according to real estate consulting firm LeeChiu Property Consultants.
LPC chief executive David Leechiu said in a news briefing the online gaming industry was expected to take up 400,000 to 500,000 square meters of office space this year.
Leechi said the figure would account for half of the 800,000 sqm projected takeup of the business process outsourcing industry.
This will make the online gaming sector the second biggest demand driver for office space, he said.
“In the last 15 years, the BPO has the office market all for itself. Now, we have somebody also chasing space from the mark and that is online gaming industry and they did this practically overnight,” Leechiu said.
“The online gaming industry could potentially reach BPO industry demand numbers within the first year of entry in the market. That’s how big the potential could be,” he said.
Data from LPC showed that over the last six months, the online gaming industry took up 83,960 sqm of office space mostly in the Bay Area, Alabang and Bonifacio Global City.
The consulting firm said aside from boosting office demand, the new industry also contributed to the takeup of residential units in key Metro Manila locations.
State-owned Philippine Amusement and Gaming Corp. already approved 35 applications for Philippine offshore gaming operations licenses. Each licensee can accommodate 7 to 8 sub-licenses.
Average office space required by online gaming firms range from 10,000 sqm to 20,000 sqm.
This trend is expected to keep office vacancy rates at a minimum while rental rates are expected to remain high.
Vacancy rate across Metro Manila is currently at 4.2 percent.
Leechiu said the supply of office space over the next six years is expected to remain strong. At least 5.4 million sqm of office space will be completed from 2017 to 2023, including 4 million sqm in Metro Manila.
He said this year alone, 1.29 million sqm of office space in Metro Manila would be completed with nearly 500,000 sqm already pre-committed.
Aside from BPO and online gaming sectors, other industries taking up most office space in the country are banking and office, healthcare and information technology and manufacturing.