Facebook Instagram Linkedin Twitter Youtube
Home Blog Page 5473

Shots fired at LIV after FedEx winner McIlroy lauds PGA as ‘greatest place’ to golf’

RORY MCILROY produced the largest final-round comeback in Tour Championship history to beat world number one Scottie Scheffler by one stroke in Atlanta on Sunday and then used the moment to sing the praises of the PGA Tour.

Mr. McIlroy, who began the final round at East Lake six shots back of Mr. Scheffler, carded a four-under-par 66 to reach 21 under on the week at the PGA Tour’s season-ending event to capture his third FedExCup title and an $18 million first-place prize.

After being presented with the trophy, Mr. McIlroy, who has become one of the one of the most important voices for the PGA Tour amid the threat from LIV Golf, spoke about his passion for the US-based circuit.

“I believe in the game of golf, I believe in this tour in particular. I believe in the players on this tour,” said world number four Mr. McIlroy. “It’s the greatest place in the world to play golf, bar none. And I’ve played all over the world.”

“This is an incredibly proud moment for me but it should also be an incredibly proud moment for the PGA Tour. They have had some hard times this year but we are getting through it.”

“That was a spectacle out there today. Two of the best players in world going head-to-head for the biggest prize on the PGA Tour and I hope everyone at home enjoyed that.”

The final round was a back-and-forth tussle between Mr. McIlroy and world number one Mr. Scheffler (73), who were paired together, as they traded places atop the leaderboard while South Korea’s Im Sung-jae (66) threatened but settled for a share of second.

Mr. McIlroy began the round with a bogey but responded with four birdies over his next six holes and walked off the seventh green level with a misfiring Mr. Scheffler, who made three early bogeys.

Mr. Scheffler moved back in front with a birdie at the eighth but Mr. McIlroy re-joined him atop the leaderboard with a six-foot birdie at the par-four 12th before falling a shot back after a bogey at 14.

Mr. McIlroy again grabbed a share of the lead, this time at the par-three 15th where his birdie putt from 31 feet rolled into the heart of the cup, lighting up the crowd and setting the stage for a tense finish.

At 16, Mr. McIlroy caught a lucky break as his fast-rolling chip was headed for the other side of the green until it slammed into the flagstick and settled eight feet from the hole from where he saved par while Mr. Scheffler bogeyed to fall one back.

“I feel sort of bad that I pipped him to the post,” said Mr. McIlroy, who finished runner-up to Mr. Scheffler at the Masters and started the Tour Championship six shots back of the world number one given the event’s staggered-strokes start.

“It was an honor and a privilege to battle with him today and I am sure we’ll have many more. I told him we’re ‘one all’ in Georgia this year. He got the Masters, I got this.”

The previous largest final-round comeback at the Tour Championship came in 2008 when Camilo Villegas trailed Sergio Garcia by five shots but carded a 66 and went on to defeat the Spaniard in a sudden-death playoff. — Reuters

India’s state-funded helmet promises ‘fresh air’ in battle on winter smog

SHELLIOS.COM
SHELLIOS.COM

NEW DELHI — As India’s capital of New Delhi prepares for winter — and the accompanying season of acrid smog — the government is promoting a motorcycle helmet fitted with filters and a fan at the back that it says can remove 80% of pollutants. 

State agencies have pumped thousands of dollars into Shellios Technolabs, a startup whose founder Amit Pathak began work on the helmet, which he calls the world’s first of its kind, in a basement in 2016. 

That was the year of the first headlines about the filthy air that makes New Delhi nearly unbreathable from mid-December to February, as the heavy cold traps dust, vehicle emissions and smoke from burning crop waste in nearby states. 

“Inside a home or office, you could have an air purifier,” said Mr. Pathak, an electrical engineer. “But the guys on the bike, they have no protection at all.” 

So his company designed a helmet with an air purification unit, fitted with a replaceable filter membrane and a fan powered by a battery that runs six hours and can be charged through a microUSB slot. 

Sales of the helmet began in 2019, and tests on New Delhi’s streets by an independent laboratory confirmed it can keep more than 80% of pollutants out of users’ nostrils, Mr. Pathak added. 

A 2019 test report seen by Reuters shows the helmet cut levels of lung-damaging PM 2.5 airborne particles to 8.1 micrograms per cubic metre from 43.1 micrograms outside. 

India’s science and technology ministry says the helmet offers “a breath of fresh air for bikers”. That may not come a moment too soon in a country that was home to 35 of the world’s 50 worst polluted cities. 

Mr. Pathak sees a big opportunity amid annual demand for 30 million helmets, but declined to reveal his production or sales figures. 

Each helmet retails at 4,500 rupees ($56), or nearly four times the cost of a regular one, effectively putting the device beyond the reach of many riders in India. 

Since the weight of 1.5 kg is heavier than existing devices, Shellios has tied up with a big manufacturer to develop a lighter version from a thermoplastic material rather than fiberglass, a step that will also cut the cost. 

The new version is expected to come out within a few months. 

Mr. Pathak said the company had also drawn interest from southeast Asian nations such as Malaysia, Thailand and Vietnam. ($1=79.8210 rupees) — Reuters

IAEA mission heads to Ukraine’s Zaporizhzhia nuclear plant; Russia pounds Donbas

IAEA.ORG

KYIV — A team from the United Nations (UN) nuclear watchdog was on its way on Monday to Ukraine’s Zaporizhzhia nuclear plant, the agency’s chief said, as Russia and Ukraine traded accusations of shelling in its vicinity, fueling fears of a radiation disaster. 

Captured by Russian troops in March but run by Ukrainian staff, Zaporizhzhia has been a hotspot in a conflict that has settled into a war of attrition fought mainly in Ukraine’s east and south six months after Russia launched its invasion. 

“We must protect the safety and security of Ukraine’s and Europe’s biggest nuclear facility,” Rafael Grossi, chief of the International Atomic Energy Agency (IAEA), said in a post on Twitter. 

An IAEA team he was leading was on its way to the south Ukraine plant and would arrive later this week, Mr. Grossi said. 

The United Nations and Ukraine have called for a withdrawal of military equipment and personnel from the nuclear power plant to ensure it is not a target. 

The two sides have for days exchanged accusations of courting disaster with their attacks. 

With fears mounting of a nuclear accident in a country still haunted by the Chernobyl disaster, Zaporizhzhia authorities are handing out iodine tablets and teaching residents how to use them in case of a radiation leak. 

Russian forces fired at Enerhodar, the city where the plant is located, the chief of staff of Ukraine’s president, Volodymyr Zelenskyy, said late on Sunday on his Telegram channel alongside a video of fire fighters dousing burning cars. 

“They provoke and try to blackmail the world,” Andriy Yermak said. 

Ukraine’s military earlier reported shelling of nine more towns on the opposite side of the Dnipro river. 

‘RADIATION NORMAL’
Russia’s defense ministry reported more Ukrainian shelling at the plant over the weekend. 

Nine shells fired by the Ukrainian artillery landed in the plant’s grounds, Russian Defense Ministry spokesman Igor Konashenkov said. 

“At present, full-time technical personnel are monitoring the technical condition of the nuclear plant and ensuring its operation. The radiation situation in the area of the nuclear power plant remains normal,” he said in a statement. 

The Russian state news agency cited authorities as saying they had downed a Ukrainian drone which planned to attack the nuclear-waste storage facility at the plant. 

Two of the plant’s reactors were cut off from the electrical grid last week due to shelling. 

Ukrainian nuclear company Energoatom said it had no new information about attacks on the plant and Reuters could not verify the accounts. 

The U.S. State Department said on Sunday that Russia did not want to acknowledge the grave radiological risk at plant and had blocked a draft agreement on nuclear non-proliferation because it mentioned such risk. 

‘ANSWER FOR ATTACKS’
Ukrainian officials said Russian forces also kept up their shelling in the Donbas, Ukraine’s industrial heartland in its east. 

Mr. Zelenskyy, in a video address late on Sunday, vowed “the occupiers will feel their consequences — in the further actions of our defenders.” 

“No terrorist will be left without an answer for attacks on our cities. Zaporizhzhia, Orykhiv, Kharkiv, Donbas — they will receive an answer for all of them,” he added. 

Russia invaded Ukraine on Feb. 24 in what it called a “special military operation” saying it had to demilitarise its southern neighbour. Ukraine and its Western allies have dismissed this as a baseless pretext for war. 

The invasion of Ukraine has touched off Europe’s most devastating conflict since World War Two. 

Thousands of people have been killed, millions displaced and cities blasted to ruins. The war has also threatened the global economy with an energy and food supply crisis. 

Russian shelling has displaced more civilians in the east, where three quarters of the population has fled the front-line region of Donetsk, the regional governor has said. 

In Donetsk, Russian forces shelled military and civilian infrastructure near Bakhmut, Shumy, Yakovlivka, Zaytsevo, and Kodema, Ukraine’s military said early on Monday. 

Russian strikes killed eight civilians in the Donetsk region on Sunday, the region’s governor Pavlo Kyrylenko said. 

Russia denies targeting civilians. 

The United States and its allies have imposed sweeping sanctions on Russia for its invasion and sent billions of dollars in security assistance to the Ukrainian government. 

Russia has said sanctions will never make it change its position and Western arms supplies only drag out the conflict. 

Ukrainian Foreign Minister Dmytro Kuleba will travel to Sweden and Czech Republic this week and push for more sanctions on Russia, including an EU-wide visa ban for Russians. 

European Union foreign ministers meeting this week are unlikely to unanimously back a visa ban on all Russians, EU foreign policy chief told Austria’s ORF TV. — Reuters

NASA’s next-generation megarocket set for debut test launch to moon

NASA/Joel Kowsky

CAPE CANAVERAL, Fla. — NASA’s colossal next-generation rocketship was set for its long-awaited debut launch on Monday on an uncrewed, six-week test flight around the moon and back, marking the first mission of the space agency’s Artemis program, successor to Apollo.

The 32-story-tall, two-stage Space Launch System (SLS) rocket and its Orion crew capsule were due for blast-off from the Kennedy Space Center in Cape Canaveral, Florida, during a two-hour launch window opening at 8:33 a.m. EDT (1233 GMT).

The maiden voyage of the SLS-Orion, a mission dubbed Artemis I, is intended to put the 5.75-million-pound vehicle through its paces in a rigorous demonstration flight, pushing its design limits, before NASA deems it reliable enough to carry astronauts.

Billed as the most powerful, complex rocket in the world, the SLS represents the biggest new vertical launch system the U.S. space agency has built since the Saturn V flown during the Apollo moon program of the 1960s and ’70s.

The spacecraft was slowly trundled to historic Launch Pad 39B earlier this month following weeks of final preparations and ground tests. Last week, NASA officials concluded their flight readiness review declaring all systems were “go for launch.”

One issue cited by NASA officials last week as a potential show stopper for Monday’s launch would be any sign during rocket fueling that a newly repaired hydrogen line fitting had failed to hold.

If the countdown clock is halted for any reason, NASA has set Sept. 2 and Sept. 5 as backup launch dates.

Barring last-minute technical difficulties or unfavorable weather, Monday’s countdown should end with the rocket’s four main R-25 engines and its twin solid-rocket boosters igniting to produce 8.8 million pounds of thrust, about 15% more thrust than produced by the Saturn V, sending the spacecraft streaking skyward.

About 90 minutes after launch, the rocket’s upper stage will thrust Orion out of Earth orbit on course for a 42-day flight that brings it to within 60 miles of the lunar surface before sailing 40,000 miles (64,374 km) beyond the moon and back to Earth. The capsule is expected to splash down in the Pacific on Oct. 10.

Although no humans will be aboard, Orion will be carrying a simulated crew of three — one male and two female mannequins — fitted with sensors to measure radiation levels and other stresses that real-life astronauts would experience.

A top objective for the mission is to test the durability of Orion’s heat shield during re-entry as it hits Earth’s atmosphere at 24,500 miles (39,429 km) per hour, or 32 times the speed of sound, on its return from lunar orbit — much faster than more common re-entries of astronaut capsules returning from low-Earth orbit.

“That’s our highest priority that we have to accomplish,” lead flight director Rick LaBrode said of demonstrating the heat shield’s ability to withstand re-entry friction, expected to raise temperatures outside the capsule to nearly 5,000 degrees Fahrenheit (2,760 Celsius). “That’s what’s going to keep the capsule together and save the astronauts.”

BACK TO THE MOON 

NASA’s Artemis program — named for the goddess who was Apollo’s twin sister in ancient Greek mythology — aims to return astronauts to the moon’s surface as early as 2025, and to establish a long-term lunar colony as a stepping stone to even more ambitious future voyages sending humans to Mars.

More than a decade in development with years of delays and billions of dollars in budget overruns, the SLS-Orion spacecraft has so far cost NASA least $37 billion, including design, construction, testing and ground facilities.

NASA chief Bill Nelson has defended the Artemis program as a boon to space exploration and an “economic engine,” noting that in 2019 alone, for example, it generated $14 billion in commerce and supported 70,000 US jobs.

Among the program’s greatest financial beneficiaries are the principal SLS and Orion primary contractors — Boeing Co and Lockheed Martin Corp, respectively.

Twelve astronauts walked on the moon during six manned Apollo missions that landed from 1969 to 1972, the only spaceflights yet to place people on the lunar surface.

If successful, Artemis I will pave the way to a first crewed SLS-Orion mission, an out-and-back flight around the moon designated Artemis II, as early as 2024, to be followed a year or more later by an Artemis III journey to the lunar surface.

Artemis III involves a much higher degree or complexity integrating the SLS-Orion with a series of spacecraft to be built and flown by Elon Musk’s launch company SpaceX.

Those include SpaceX’s own heavy-duty Starship launch and lunar-landing vehicle, still under development, as well as several components that remain to be constructed — an orbital fuel depot and space tankers to fill it. Even the new moon-walking suits remain to be designed.

NASA’s Office of Inspector General last year said that the first Artemis  III lunar landing was more likely to be achieved two to three years later than the agency’s late 2025 target date. — Reuters

Pakistan foreign minister says help needed after ‘overwhelming’ floods

PUNJAB EMERGENCY SERVICE DEPARTMENT/FACEBOOK

ISLAMABAD — Pakistan needs financial help to deal with “overwhelming” floods, its foreign minister said on Sunday, adding that he hoped financial institutions such as the International Monetary Fund (IMF) would take the economic fallout into account. 

Unusually heavy monsoon rains have caused devastating floods in both the north and south of the country, affecting more than 30 million people and killing more than 1,000. 

“I haven’t seen destruction of this scale, I find it very difficult to put into words … it is overwhelming,” said Pakistan’s Foreign Minister Bilawal Bhutto-Zardari in an interview with Reuters, adding many crops that provided much of the population’s livelihoods had been wiped out. 

“Obviously this will have an effect on the overall economic situation,” he said. 

The South Asian nation was already in an economic crisis, facing high inflation, a depreciating currency and a current account deficit. 

The IMF board will decide this week on whether to release $1.2 billion as part of the seventh and eighth tranches of Pakistan’s bailout programme, which it entered in 2019. 

Mr. Bhutto-Zardari said the board was expected to approve the release given an agreement between Pakistani officials and IMF staff had already been reached and he hoped in coming months the IMF would recognise the impact of the floods. 

“Going forward, I would expect not only the IMF, but the international community and international agencies to truly grasp the level of devastation,” he said. 

CLIMATE CHANGE
Mr. Bhutto-Zardari, the son of assassinated former Prime Minister Benazir Bhutto, said the economic impact was still being assessed, but that some estimates had put it at $4 billion. Given the impact on infrastructure and people’s livelihoods, he said he expected the total figure would be much higher. 

Pakistan’s central bank had already flagged the record monsoon rainfall as a threat to economic output given its impact on agriculture. 

Pakistan would this week launch an appeal asking United Nations member states to contribute to relief efforts, Mr. Bhutto-Zardari said, and the country needed to look at how it would handle the longer term impacts of climate change. 

“In the next phase, when we look towards rehabilitation and reconstruction, we will have conversations not only with the IMF, but with the World Bank, the Asian Development Bank,” Mr. Bhutto-Zardari said. 

Mr. Bhutto-Zardari said after relief efforts, the country would have to look at how to develop infrastructure that was more resistant to both floods and droughts and address the huge changes faced by the agriculture sector. 

“Despite the fact that Pakistan contributes negligible amounts to the overall carbon footprint … we are devastated by climate disasters such as these time and time again, and we have to adapt within our limited resources, however we can, to live in this new environment,” he said. — Reuters

Bank of Korea’s Rhee says policy tightening unlikely to end before Fed

REUTERS

JACKSON HOLE, Wyo./SEOUL — The Bank of Korea (BOK) must keep raising interest rates until the rate of inflation is in decline, but the central bank likely could not halt its tightening before the US Federal Reserve, Governor Rhee Chang-yong said on Saturday.

In an interview with Reuters, Mr. Rhee also said South Korea’s central bank is ready to take steps, including intervention to stabilize the won against the dollar, if needed, should the bank determine speculative forces are causing the currency’s fall.

Mr. Rhee’s comments, on the sidelines of the Jackson Hole conference of central bankers in the US state of Wyoming, dampened speculation that the BOK might be one of the first big central banks to ease off in the global battle against the steepest inflation in decades.

Asia’s fourth-largest economy has been in the vanguard of global tightening. The BOK was among the first central banks to abandon pandemic-era monetary stimulus, raising its key policy rate by 2 percentage points since August last year to 2.5%.

Dollar appreciation driven by Fed rate increases has added to inflation in many open economies around the world, including South Korea, as local currencies fall in value.

“We are now independent from government, but we are not independent from the Fed,” Mr. Rhee said. “So if the Fed continues to increase the interest rate, it will have a depreciation pressure for our currency.”

Although the BOK began raising interest rates before the Fed, with its first hike a year ago, “whether we can end earlier — I don’t think so.”

South Korea’s inflation is largely the result of external issues such as energy prices, Mr. Rhee said.

“If you ask me, whether I’m going to stop … what happens if the oil price increases again?” he said. “It’s very hard for us to know the exact timing, given the importance of the external shock.”

Even though he expects domestic inflation to slow in August compared with the 6.3% rate seen in July, it is “too premature” to say it has peaked, especially since, as winter approaches, gas prices could again rise.

The BOK raised rates by a quarter point at its last meeting and said further quarter-point increases “will be appropriate for some time as long as inflation paths remain as currently presumed.”

At this point, “I cannot say we are ahead of the curve,” Mr. Rhee said. “As long as inflation remains high, meaning 4%–5% … then we will definitely continue to emphasize the normalization” of interest rates.

EYE ON THE WON 

Inflation in South Korea is forecast around 5% by the end of 2022, and to fall through 2023. Its central bank, like many others, targets 2% inflation.

At Jackson Hole, central bankers used largely the same language to describe their battle against rising prices. Though the headline problem is the same — inflation far above their established targets — the sources of price pressure and therefore the policy responses differ among countries.

For smaller, open economies like South Korea’s, the situation is particularly complex because of the spillover effects from policies set elsewhere.

Federal Reserve Chairman Jerome Powell on Friday kicked off the Jackson Hole conference by saying the Fed will raise rates as high as needed to restrict growth, and would keep them there “for some time” to bring down inflation.

His speech sparked a sell-off in US equity markets, and Mr. Rhee said on Monday attention would turn to the won.

The won, one of Asia’s worst-performing currencies, has dropped about 11% against the dollar this year, and local officials have stepped up surveillance of the currency’s movements.

Mr. Rhee said so far he did not see the depreciation as driven by speculation or South Korea’s economic fundamentals, but as part of the dollar’s rising global strength.

“There are a few days we see movement that’s too excessive — but so far I think our exchange rate movement is very much in line with major currencies,” Mr. Rhee said.

But should the BOK detect speculative moves in dollar-won trading, he stands ready to intervene in currency markets. The won has been falling faster than currencies in neighboring China and Japan, partly because they maintain loose monetary policies, he said.

Policymakers from President Yoon Suk-yeol to Finance Minister Choo Kyung-ho have stepped up their rhetoric to try to slow the won’s decline repeatedly over the last week.

Prime Minister Han Duck-soo said on Sunday the won’s weakness should help South Korea’s economy, in aspects of exports and the current account, adding that he hopes monetary policy may not have to be tightened by as much or as quickly as in the United States.

“This depreciation pressure due to the dollar strength actually is a bad factor for our inflation, because our imported prices increase a lot,” Mr. Rhee said. But “the current depreciation pressure does not mean any liquidity problems or solvency problems, or credit problem for Korea.” — Reuters

[B-SIDE Podcast] The birth of the Filipino nation

Follow us on Spotify BusinessWorld B-Side

In this B-Side episode, playwright, historian, and educator Dr. Paul A. Dumol talks about the birth of the Filipino nation, a relatively new concept that emerged at the beginning of the 20th century.

In a conversation with BusinessWorld reporter Diego Gabriel C. Robles, Dr. Dumol touches on the writing of National Hero Jose P. Rizal, author Nicomedes “Nick” M. Joaquin, and historian Teodoro A. Agoncillo to answer the questions: Who was the Filipino then? Who is the Filipino now? Where are we, the Filipinos of today, headed as a nation?

“What does ‘being Filipino’ mean,” Dr. Dumol said in the vernacular. “I think it means, at the very least, love for everybody else.”

TAKEAWAYS
Nationalism is new and not everybody understands it.

Dr. Dumol theorized that nationalism spread widely and quickly among Filipinos through the public system installed by the Americans.

“This notion … really emerges only in the beginning of the 20th century. And I’m sure not very many people felt it,” he said. “This idea is relatively new, and not everybody understands it.” 

“I think our problem is understanding the duties and responsibilities that come with citizenship,” he continued.

In the Philippines, family often trumps nation. 

“Many times, when we complain about people who are corrupt. … We see that their motivation is frequently their family. They’re thinking of their family. But we may complain, ‘wait, can’t you also think of the nation?’ and there’s so many anecdotes about that tension,” he said. 

“It’s very hard for us to transcend the universe of the family — I’m not saying that we should abandon our families or that we should be indifferent to them. [Rather], we should not be exclusively focused on our own families, and consider that we belong to a society. We should think not only of ourselves but also about everybody else.” 

True integration means that no one gets left behind. 

According to Dr. Dumol, true integration goes beyond political sloganeering and takes into account all social groups — whether national, regional, or familial — and loving each without neglecting one for the sole benefit of another. 

Recorded remotely August 2022. Produced by Joseph Emmanuel L. Garcia, Earl R. Lagundino, and Sam L. Marcelo.

Follow us on Spotify BusinessWorld B-Side

An opportunity to sustain a good start

By Adrian Paul B. Conoza, Special Features Assistant Editor

The Philippine office segment has seen indications of an initial rebound so far this year, and this has been largely marked by the growing preference for flexibility at work.

As shared by Joey Roi Bondoc, associate director and head of research at Colliers Philippines, in a special report in BusinessWorld earlier this month, data from their firm recorded that 306,100 square meters (sq.m.) of new supply completed in the first quarter (Q1) of 2022, exceeding the 114,300 sq.m. (1.2 million sq. ft.) completed in the fourth quarter (Q4) of 2021.

“Among the buildings completed in the first quarter were One Ayala Towers 1 & 2 in Makati CBD (Central Business District), DoubleDragon Tower, Four E-com Tower 3 and Iland Bay Plaza in the Bay Area, NEX 54 in Ortigas Fringe and Savya Financial Center North in Arca South,” Mr. Bondoc added.

Net take-up, meanwhile, escalated from minus 130,100 sq.m. in the Q4 of 2021 to 26,400 sq.m. in Q1 2022 — the first recorded positive net take-up after seven consecutive quarters of negative net absorption.

Colliers also noted that office transactions in the capital region totaled 146,100 sq.m., an increase of 30% year-on-year.

Robinsons Land Corp. (RLC) finds themselves in a similar path with these positive observations, as Jericho P. Go, the developer’s senior vice-president and business unit general manager for Offices, said.

“We have seen a positive uptick in office leasing transactions with the way we have configured our developments,” Mr. Go told BusinessWorld in an e-mail.

Hub-and-spoke

In addition, Colliers observed that traditional and outsourcing firms took up space during Q1, both inside and outside the metro. Most of the firms leased space in Fort Bonifacio, the Bay Area, and Makati CBD. Outside of Metro Manila, absorption of new office space was spotted in Pampanga, Cebu, Iloilo, Davao, and Cagayan de Oro.

This expanded presence of offices is reflected by the implementation of a hub-and-spoke strategy, where offices retain operations in urban centers or CBDs while expanding them in “second-and third-tier cities and locations.”

On RLC’s end, this strategy has been applied even before the pandemic hit the property sector.

“In Metro Manila, we have the largest population base and a wealth of labor resource in terms of complexity, availability, and diversity,” Mr. Go said.

While maintaining presence in Metro Manila, RLC is aggressively expanding in key cities in the provinces.

“Going into these provinces, we provide options to those who want to work near their families. We are experiencing an increase in inquiries and signups in key cities,” the developer said.

Alexis Ortiga, vice-president of the SM Commercial Properties Group, under SM Prime Holdings, Inc. (SMPH), also observed an increase of offices in the fringe areas going into the provinces.

“Iloilo is a very popular market right now. The Cavite, Laguna, and Batangas areas are also popular for both warehouses and offices,” Mr. Ortiga said.

Emphasis on flexibility

Also being realized in the past six months, and beyond, is stronger flexibility in work, where on-site and remote modes converge.

The latest Asia Pacific Workforce Preferences Barometer of Jones Lang LaSalle (JLL) highlighted that an ‘optimal point’ has been reached among office workers, with hybrid work preferred by 60% of employees surveyed and being implemented already by 55% of respondents. The research also found that three in four employees agree that hybrid is a non-negotiable factor in talent retention, and 78% of respondents who advocate remote working are actually managers.

JLL’s research further noted that the office is set to become a hub for human connection and innovation, as 56% of organizations plan to refit or redesign their office space in the next 12 months.

In addition, based on its workplace strategy tool called Experience per Square Foot TM, Cushman & Wakefield expects greater workplace flexibility to take further shape in the post-pandemic period.

“We can expect a significant flight to quality among corporate occupiers, with state-of-the-art buildings featuring smart technology considered attractive by employees. Moreover, office spaces with flexible floor plans are preferred, to accommodate increased allocation for collaboration areas and well-being facilities,” Claro Cordero, Jr., director and head of research, Consulting & Advisory Services at Cushman & Wakefield, explained in another outlook previously published in BusinessWorld.

Mr. Ortiga of SMPH agrees that flexible office spaces are now preferred by a lot of tenants.

“They want more open layouts, higher floor-to-ceiling clearance, and of course a lot of them have heavily invested in safety protocols,” he said.

RLC, for its part, observed similar needs for flexibility amid the pandemic, and so has resolved to reconfigure their workspaces to meet employees’ needs in the new normal, as shown in their headquarters at the 25th floor of Robinsons Cyberscape Alpha in Ortigas Center, Pasig City.

“Professionals have grown accustomed to working from home during the pandemic, but the disadvantages in that include interruptions in power supply, internet connection, and mental health because of the relative isolation as one works alone and is not in personal contact with peers,” Mr. Go observed.

Considering these factors, RLC developed an environment designed for employees to “enjoy the best of both worlds.” The developer incorporated elements of a home, such as the living room area, the pantry, and the bar; while also adding ‘fun’ elements such as a billiards table, a Ping-Pong table, a foosball table.

“All of these facilitate collaboration, interaction, coordination, camaraderie, and synergy within the workplace, ultimately creating a winning culture so that when employees go back to the office, they are inspired to create innovations and new ways of doing business,” Mr. Go explained.

Relevant technologies have also been rolled out, alongside health and safety protocols.

“For instance, we installed generous provisions for treated outdoor air to deliver airflow rates that exceed the [Department of Labor and Employment] standard. Through this, we ensure a healthy work environment with air exchange that expel virus. More and more people would want to have that,” Mr. Go said.

Safety features have been a long-standing practice for SMPH’s offices.

“For example, hourly cleaning and sanitation of high touch point areas — we’ve been doing that for a long time now. Having MERV 13 filters in our ventilation systems so that the air we breathe inside SM Offices is cleaner,” Mr. Ortiga shared.

Looking ahead

Backed by a good start, the office segment is expected to sustain its progress towards recovery.

Lobien Realty Group (LRG) notes that this recovery, particularly in the Metro Manila market, is set to start in Q4 2022. LRG reported that the office vacancy rate in the said market is expected to improve from first half’s 19% as office demand picks up with increased economic activity.

LRG also found that the Makati CBD has a pipeline of 307,000 sq.m. in office spaces that is expected to be completed by 2028. Taguig’s business district is found to have 250,000 sq.m. of office space in the pipeline, while Pasig has 139,000 sq.m.

“Opportunity is seen for office space tenants and locators due to the 19% vacancy rates, ample supply of office space pipeline in all office space grades, and the possible weakening of rental rates for landlords to shed the available office supply in the market,” LRG was quoted as saying in a recent BusinessWorld report.

Colliers, for its part, projects new supply to reach 821,900 sq.m. this year, a 30% increase from 2021 completions.

Further on demand, Mr. Cordero of Cushman & Wakefield spoke of a favorable long-term outlook for the major demand drivers of office space.

Citing a recent study of the firm on the Asia-Pacific office market, Mr. Cordero said total employment in office-using jobs in the Philippines is expected to grow by more than 2.4 million, which translates to more than 8.3 million sq.m. in office space demand. This is equivalent to a more than 70% increase in the current stock of office space in the country.

“The near-term outlook on net office space absorption in the Philippines will still be lower than the estimated average in the last 15 years,” Mr. Cordero continued. “The expansionary demand in the medium term, however, will come from the continued growth of the outsourcing and information technology and business processing management (IT-BPM) companies.”

RLC’s Mr. Go also shared other potential drivers in the office segment.

“In the office sector where there is an oversupply, the return of POGO (Philippine offshore gaming operators) may reduce vacancies. When the supply and demand imbalance is corrected, there is an expectation that rental rates will improve. We also see an opportunity with the requirements on data centers. Sectors such as data analytics, robotics, and artificial intelligence, will benefit from the infrastructure technology provided by data centers to help them grow. These industries are expected to take up office spaces,” he said.

Challenges

However, caution is indicated on JLL’s most recent outlook. In its “Global Real Estate Perspective” for the office segment this month, JLL found that current economic headwinds are impacting the construction sector and will flow through to the development pipeline over the coming 12 to 24 months.

“Rising construction costs, a shortage of labor (especially in Eastern Europe due to the war in Ukraine), and supply chain disruption are creating uncertainty and will help to shape the development pipeline. The future supply pipeline is consequently anticipated to tighten and there is potential for deliveries to be delayed,” JLL explained on its website.

Likewise, RLC, as an importer of raw materials and equipment for office developments such as building elevators, generation sets, air-conditioning units and escalators, sees certain global events as a cause for concern.

“Such events may affect the flow of goods and services and the deliveries on raw materials and equipment. When deliveries are disrupted, it will affect the completion and handover of projects,” Mr. Go said.

Amid these challenges, for Mr. Go, the segment’s recovery is sure to happen.

“Slowly but surely, we are nearing pre-pandemic levels. We are optimistic because of the hub-and-spoke strategy that we have adopted even before the pandemic hit, with Metro Manila as the base of operations. This strategy effectively brings in new inquiries and signups for the business,” Mr. Go said.

Mr. Go also believes that RLC’s large investment in flexible spaces will start its growth for a ‘better normal.’

“As we go back to the office, performance is expected to improve for our company and like-minded companies, who would want to start again and enjoy the same benefits of collaborative workspaces, gaming areas, airflow rates, etc. That concept is resonating well to office locators as evidenced by the increase in inquiries and signups year-on-year since 2020,” Mr. Go said.

SMPH, meanwhile, believes it has figured out a design formula that works well for employers, tenant-partners, and their employees and guests.

“Given our amenities and conveniences, I’m proud to say we give real meaning to the phrase ‘work-life balance’, and how we’re able to treat each tenant-partners and their employees as human beings, not just tenants that fill up our spaces,” Mr. Ortiga said.

Latest office developments catering to the evolving workspace dynamics

By Chelsey Keith P. Ignacio, Special Features Writer

The concept of a workspace has been redesigned among office-based employees as companies shifted to a work-from-home setup due to the pandemic.

From having one’s own workstation at the office, people have designated an area at home as their workspaces. Meetings at the boardroom have been replaced by a video-conferencing platform. And collaborating with colleagues has been mostly powered by technology. This is the ‘new normal’ workspace that most office-based employees had to move into.

Having functioned in a different work arrangement for over two years, the interests or expectations in one’s office might have changed now resulting to the current conversations about the future of offices.

Envisioning work beyond the pandemic is prominently about hybridity. Among the findings of real estate services and investment firm CBRE’s 2022 Asia Pacific Occupier Survey released last May, which focused on crafting the post-pandemic office, involved balancing the ‘me’ and ‘we’ spaces. The surveyed office occupiers saw areas for more enclosed soundproofed space for individuals as well as collaborative space for unscheduled catch-ups and communal space for socializing as priorities.

Technology would also be crucial in empowering hybrid work. The survey recorded ‘little interest’ from occupiers in making their own employee experience applications or installing smart building features. But this is because landlords assumed most of the responsibility in this part.

Yet, the research also noted that hybrid work adoption would stipulate for “more sophisticated real estate and will drive demand for ‘futureproof’ buildings” that encompass physical, human, and digital elements. And among the surveyed occupiers’ most sought-after building attributes in these areas are flexible open space, indoor air quality, and touchless technologies, respectively.

Furthermore, CBRE’s survey saw that ESG (Environmental, Social, and Governance) compliant office buildings are “widely considered by occupiers as an essential criterion for a new office.”

As the perception and preference towards the office went some changes, how did property developers build their new office developments in a way that could accommodate the changed future of work?

Robinsons Land Corp. (RLC) recently announced the completion of the top floor of its new office building GBF Center 1, which the property developer said is designed to cater to the evolving workplace dynamics beyond the pandemic.

Keeping in mind the evolving trends and changing needs of office locators, PEZA-registered GBF Center 1 is designed to suit new workplace dynamics in the post-pandemic era and to support aggressive business expansion plans.

The 30-storey GBF Center 1 offers wide and flexible office spaces with floor plates of about 2,500 square meters (sq. m.).

RLC also took note of the demands of the modern workforce in building GBF Center 1, reinforcing its commitment to go contactless through modern features such as QR-activated turnstiles and elevators in the building.

In addition, the new office development would be equipped with generous provisions for treated outdoor air to deliver an ideal airflow rate that surpasses the prescribed DOLE standards.

Located at the entrance of Bridgetowne Destination Estate, RLC’s first mixed-use development that straddles the border of Quezon City and Pasig City, GBF Center 1 is a sustainable building. It is equipped with a rainwater collection facility, LED lights, as well as electric charging stations, and bicycle racks. The office building is aiming to secure LEED (Leadership in Energy and Environmental Design) Gold Certification.

“The GBF towers are envisioned to be a landmark structure along the C5 IT corridor. The building design, technology, and green building features are meant to stand out,” said Jericho P. Go, RLC’s senior vice-president and business unit general manager for Offices, said.

Upon completion of GBF Centers 1 and 2, RLC plans to add more office buildings to its portfolio to accommodate tenants’ needs in the next five to 10 years.

“Bridgetown has been carefully master planned to offer the best in class for your live, work, play, and inspire experience. In our well-designed workspaces, we can truly say that work can be fun,” Mr. Go said.

As the economy further opens, more companies started to implement return-to-office, while outsourcing companies are pursuing expansion plans. Thus, a pickup in demand for office space is beginning to be seen by Colliers Philippines in its office market report for the second quarter of 2022.

The property consultancy firm recorded the completion of about 146,700 sq. m. of new office supply in Metro Manila during the said period, lower than the 306,100 sq. m. of the quarter prior. It expects the delivery of 356,200 sq. m. of new office space for the remainder of the year, with Makati Fringe and Ortigas CBD likely to cover 65% of the remaining supply.

Colliers projects the annual completion of about 543,300 sq. m. from 2023 to 2026.

Creating spaces for human connection

SM Prime Commercial Properties Group continues to establish office culture amidst the pandemic. The soon-to-launch FourE-com Center is a 15-storey, pre-certified LEED Gold building that will deliver a more conducive place for tenant-partners and their employees.

The world has inarguably changed in the two years of the pandemic. Digital technology in particular — how to implement it in the company strategy, cybersecurity, the Metaverse, and virtual reality, among others —has completely taken over conversations within the global business community.

It stands to reason. Digital technology has been instrumental in keeping companies afloat during the worldwide lockdowns, so it is inevitable for many to believe that the future of business will take place in the digital world.

SM Prime Holdings, Inc. (SMPH), one of Southeast Asia’s largest integrated property developers, has witnessed this change firsthand. Alexis Ortiga, vice-president of the SM Commercial Properties Group — SM Prime’s office development and leasing arm — told BusinessWorld in an interview that the harsh realities of the pandemic have led many businesses to reevaluate and reconsider their space requirements, especially considering how they can continue operations virtually any way.

The FourE-com Center Prism Plaza is poised to become one of Mall of Asia Complex’s premier after-work destinations. It is set to carry a variety of mid to high-end establishments that will cater to diverse food cravings.

“Tenant-partners have readjusted their space requirements, whether it’s expanding or decreasing them,” he said. “During the pandemic, many businesses had to recalibrate their expense items, including manpower and rent.”

However, Mr. Ortiga does not believe that these sudden adjustments will have long-lasting impact on how office spaces are viewed culturally, but rather it only changes the market’s preferences.

“Most kept their office spaces. There is still something to be said about the office. It is here to stay, it’s been ingrained in our culture, not just Filipino culture but the world in general, the need and practicality of having an office and going to the office,” he said.

“We see that culture staying and progressing. Slowly but surely, people are coming back to the office. Companies want to reestablish that office culture, redeveloping camaraderie and teamwork by working side by side with one’s colleagues. These are things that are part of our human nature for decades already. Two years of the pandemic is not going to erase that.”

The shift was not so much in the tenants’ belief in the role of offices in the future of business, but rather a change in the values that drive their choices in the market. For instance, many companies naturally are more conscious nowadays about health and safety considerations and are demanding more flexible, open-air layouts, or amenities like air filtration systems and reliable sanitation.

Mr. Ortiga noted that even before the pandemic, SM Prime, in general, has always kept the convenience and welfare of their tenant-partners and customers in mind when developing their properties. For instance, SM Offices’ buildings are strategically located nearby transportation hubs, so employees will have an easier time commuting. Its buildings are also one-stop shops which offer areas for dining, entertainment, shopping, and relaxation.

What’s more, some of the SM Offices’ buildings are also LEED Gold-certified, which represents SM’s commitment towards reducing carbon emissions, reducing power and water consumption, and waste generation.

“The office is that one venue that contends with the home as the place where a person spends most of his or her waking hours. So that office better be a super conducive place to stay in,” he said.

This emphasis on human connection is what has always driven SM Prime’s business strategy in the past, and it is what Mr. Ortiga believes will drive it in the future.

“SM’s strategy has always been consumer-centric, wherein we put the needs and welfare of our customers first. We start with our malls, and from there the residences come in, the offices come in. We know the market and community are there. SM has always been about community and nation-building,” he said.

“We want to go beyond what is expected, whether in terms of the developments we build or government and ESG requirements. In SM Prime, our business strategies cover a wide responsibility to include the well-being of our stakeholders and the environment.”

Mr. Ortiga concludes, “At SM Offices, we believe that our design formula works well for employers, tenant-partners, and their employees and guests. Given our amenities and conveniences on any given day, I’m proud to say that SM gives real meaning to the phrase ‘work-life balance’, and how we’re able to treat each tenant and their employees as human beings, not just tenants that fill up our spaces.”

 

Spotlight is BusinessWorld’s sponsored section that allows advertisers to amplify their brand and connect with BusinessWorld’s audience by enabling them to publish their stories directly on the BusinessWorld Web site. For more information, send an email to online@bworldonline.com.

Join us on Viber to get more updates from BusinessWorld: https://bit.ly/3hv6bLA.

Dollar reserves still ‘adequate’ — BSP

REUTERS

THE COUNTRY’S dollar reserves remain at an “adequate” level despite slipping below the $100-billion level as of end-July,  Bangko Sentral ng Pilipinas (BSP) Governor Felipe M. Medalla said.

At the same time, S&P Global Ratings noted the Philippines’ foreign exchange reserves remain “very high” but will likely drop as global commodity prices and interest rates continue to rise.

Many central banks have deployed the tandem of rate hikes and foreign exchange spot intervention as the US Federal Reserve continued its aggressive monetary policy tightening.

“We were responding just like other central banks to this global situation. The monetary policy in the United States is causing currencies to depreciate, so in response to that, we raised interest rates, not as much as the US did, and we also sold reserves… Nonetheless, our reserves remain comfortable and adequate,” Mr. Medalla said at the Development Budget Coordination Committee’s (DBCC) briefing for the House Committee on Appropriations on Friday.

The peso touched its all-time low of P56.45 per dollar in July.

Year to date, the peso has weakened by P6.02 or 9.84% from its P51-per-dollar close on Dec. 31, 2021.

The country’s gross international reserves (GIR) stood at $98.83 billion as of end-July, 2% lower than the $100.85-billion level as of end-June. The dollar reserves fell below the $100-billion level for the first time since August 2020 when GIR stood at $98.95 billion.   

The GIR level has been on a decline since February this year.

“Despite the recent declines in gross international reserves, the overall level remains very high, especially when put into the context of the fairly consistent trend of around $80 billion in the five years prior to the pandemic,” S&P Global Ratings Senior Economist Vincent Conti said in an e-mail.

Having an ample level of dollar reserves safeguards an economy from market volatility and is an assurance of the country’s capability for debt repayment in the event of an economic downturn.

The country’s foreign exchange buffer hit a record high of $110.12 billion in December 2020.

“In a way, the weak domestic economy during the COVID (coronavirus disease 2019) period had the positive and related side effects of a stronger currency and a strong buildup of reserves, by dampening imports and thus boosting the trade balance,” Mr. Conti said.   

“This is of course being reversed as the Philippines and the region faces capital outflow pressure amid high commodity prices and prospects of still higher global interest rates, as we note in our most recent report. That has resulted in peso depreciation as well as a slightly lower buffer from reserves,” he added.

In a research note dated Aug. 22, S&P Asia-Pacific Chief Economist Louis Kujis said foreign reserves in emerging markets in the region have declined amid heightened exchange rate volatility.

“Asian currencies have depreciated appreciably against the US dollar this year; and this has allayed much of the burden on the balance of payments,” he said.

The BSP is expecting a GIR of $108 billion for this year and $109 billion for next year. — Keisha B. Ta-asan

Elevated inflation, rising rates to drag growth, says Medalla

Department of Trade and Industry officials inspect the price of sugar at a supermarket, Aug. 26. — PHILIPPINE STAR/EDD GUMBAN

ELEVATED INFLATION and rising interest rates will drag Philippine economic growth this year, the central bank chief said.

Bangko Sentral ng Pilipinas (BSP) Governor Felipe M. Medalla on Friday said inflation is “very high” this year, but the Philippines will likely be “less affected” than other countries.

“Nonetheless, it will affect the growth because if people are spending more money on transport, fuel, food, they will have less money for other things,” he said during the Development Budget Coordination Committee’s (DBCC) briefing for the House Committee on Appropriations on Friday.

The consumer price index quickened to 6.4% year on year in July, the fastest in nearly four years, amid the continued climb in global prices of fuel and other commodities. It exceeded the central bank’s 2-4% target band for a fourth straight month.

Inflation averaged 4.7% in the first seven months, still below the central bank’s 5.4% inflation forecast for this year.

“But there’s very little we can do about it since those prices are totally beyond our control. The question whether inflation will hurt us, the answer is yes,” Mr. Medalla said.

For the first half of 2022, the economy expanded by 7.8%, exceeding the government’s 6.5-7.5% full-year target.

Mr. Medalla noted the peso’s depreciation against the US dollar is also adding inflationary pressure. As of Aug. 26, the peso has weakened by P6.02 or 9.84% from its P51-per-dollar close on Dec. 31, 2021.

“There’s too much depreciation, that is bad on the inflation for the economy. And the central bank raises interest rates, of course that will also affect the economy,” Mr. Medalla said. “But as I already stated, not enough to prevent us from achieving what was stated in the budget.”

The Marcos administration last week submitted to Congress its proposed P5.268-trillion national budget for 2023.

Most of next year’s proposed budget will go to social services at P2.071 trillion (39.31%) and economic services at P1.528 trillion (29.01%). The rest of the proposed budget is allocated to general public services at P807.2 billion (15.32%); debt burden, including net lending, at P611 billion (11.59%); and defense at P250.7 billion (4.76%).

Economic managers are targeting 6.5-8% gross domestic product (GDP) growth in 2023.

IMPACT
“Inflation or higher prices would erode the purchasing power of the government’s national budget or curtail the power of government spending as an economic growth driver/pillar,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said.

Higher interest rates would also require a bigger budget for interest payments on borrowings incurred to finance the budget deficit, he added.

“Same goes with the private sector: Higher prices/inflation reduce the funds that would otherwise go for spending and investments by consumers (about 78% of the economy), by businesses and other institutions,” Mr. Ricafort said.

China Banking Corp. Chief Economist Domini S. Velasquez said in a Viber message that rising prices have impacted the purchasing power of ordinary Filipinos.

“BSP’s recent aggressive actions seem to have re-anchored inflationary expectations and have brought some stability to the peso. However, both higher inflation and higher interest rates affect economic growth prospects,” she said.

The Monetary Board has raised its benchmark policy rate by a total of 175 bps so far this year, bringing it to 3.75%.

“We think that inflation is still on its way to peak in the fourth quarter. Hence, we expect BSP to keep raising rates at a moderate pace of 25 bps in its meetings before ending with a terminal rate of 4.5%,” Ms. Velasquez added.

If inflation starts easing in the coming months, Mr. Ricafort said there would be a lesser need for the BSP’s aggressive tightening.

The next Monetary Board policy meeting is scheduled on Sept. 22. — Keisha B. Ta-asan

1...5,4725,4735,474...13,750Page 5,473 of 13,750
© 2024 BusinessWorld Publishing.
All rights reserved.
Read our privacy guidelines
Facebook Instagram Linkedin Twitter Youtube