By Vincent Mariel P. Galang, Reporter
ORTIGAS Center and Quezon City are seen to be the next hubs for Philippine Online Gaming Operators (POGOs) as vacancy in the bay area dips below 1% in the second quarter of 2019.
Joey Roi H. Bondoc, research manager of Colliers International Philippines, said vacancy in areas near Manila Bay is now at 0.61%, which is considered to be low even for an outsourcing company.
“What more for a POGO that in one go would occupy two, three floors. I think it is but natural for them to move outside of the bay area and look at areas where office space is still available,” he said.
In its property market report for the second quarter, Colliers noted that demand for offshore gaming companies had reached 274,000 square meters (sq.m.) in the first half. Deals in the second quarter were mostly closed in Alabang, bay area, Quezon City, Ortigas, and Makati central business district (CDB) and its fringes.
The firm also noted that the new supply in the bay area, Ortigas Center, and Quezon City would be tempered by demand from online gaming operators along with traditional or non-outsourcing firms.
“Currently, we have 274,000 [sq.m. of supply], so if we estimate another 250,000, easily 150,000 sq.m. could be split between Quezon City and Ortigas Center because that’s where the available space is, so easily pwedeng doon sila mag-locate (they can locate there),” Mr. Bondoc said.
As for residential units, he said it would be difficult to determine how many units, but he noted that for one firm, an average of 40-50 units are involved in one transaction.
“They are willing to locate the following day, and they pay in cash,” he said. “That’s how strong the demand is.”
For the rest of the year, Mr. Bondoc said that the online gaming operators are likely to remain the major driver.
“For 2019, definitely. In fact we might even breach 500,000 sq.m. for 2019 alone because in 2017 we had only 11,000 sq.m., in 2018 we had 303,000 sq.m. So initially we thought na (that) we might be able to breach 400[,000 sq.m.], but look at the first half transactions, [they’re] already 274,000 [sq.m.],” he noted.
He also said that buildings, which were not approved by the Philippine Economic Zone Authority because of Administrative Order (AO) No. 18, might now welcome POGO firms.
For instance, a building in Ortigas that was initially built for non-POGOs but failed to secure accreditation, will now cater to these firms.
AO No. 18, which took effect in June, called for interagency efforts to strengthen ecozones in the countryside and put a moratorium on the processing of application for ecozones in Metro Manila.
Mr. Bondoc said the policy is not a law but only an administrative order that can be reversed.
“I think that’s what the developers are really watching out for — that it can be reversed over time,” he said, adding that economic managers might recommend the move. “Otherwise it will really be difficult in terms of space absorption from BPO [business process outsourcing] companies.”