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Offshore gaming companies are slowly renewing their interest in the Philippine office market after a massive exit last year, Leechiu Property Consultants LPC said Tuesday.
LPC chief executive David Leechiu said the company is starting to receive several inquiries from online gaming operators for possible office lease by the fourth quarter of the year.
“The POGOs [Philippine online gaming operators] are coming back and I am not talking about 500 to 1,000 square meters of office space but a chunky amount of space,” Leechiu said.
He said the passage of the proposed Senate Bill 2232, which seeks to clarify the tax concerns of POGOs and the recovery of the domestic economy, are among the factors that could bring back POGOs into the country.
LPC earlier said that of POGOs’ total 1.7 million square meters of footprint in the country, at least 396,000 sq. m. were vacated from the second quarter of 2020 to the first quarter of 2021 mainly because of the imposition of higher taxes.
LPC said POGO contractions which were reported at 118,000 sq. m. in the first quarter of 2021 retreated to 59,000 in the second quarter
Leechiu said the return of POGOs would benefit not only the only office space sector but also the retail, residential and tourism sectors.
LPC expects office demand to reach 600,000 sq. m. in 2021 on strong take up from the business process outsourcing companies. Demand reached 291,000 sq. m. in the first half.
“Meanwhile, IT-BPMs [information technology-business process management] are driving the office sector with 44 percent of demand in the first half. Economic stability in the west and the sustained rollout of the vaccines in the Philippines have prompted their return. They will be on expansion mode up to year-end,” said LPC director Mikko Barranda.
Demand from traditional firms like those in e-commerce and logistics are also expected to boost office demand, according to LPC.
LPC expects property developers to be more aggressive with residential launches in the second half, particularly on projects catering to upper middle-income segment and the high-end market.
LPC director Alvin Magat said residential projects in gated resorts were experiencing strong sales because of the pandemic amid preference of families for open and free environment.
He said Peninsula de Punta Fuego lots in Batangas province selling in 2020 for P12,000 to P60,000 per sq. m. increased to P20,000 to P100,000 per sq. m. this year.