ONLINE GAMING FIRMS are reshaping the property market, and industry officials said it might be time for the economic zone authority to help manage the sector’s growth, based on the agency’s experience overseeing the Business Process Outsourcing (BPO) sector.
“PEZA has been successful in monitoring, regulating, and supporting the growth of the BPOs, so perhaps (its experience with that sector) can also help,” Jose Romarx Salas, independent research director for Pinnacle Real Estate Consulting Services said.
He added that the growth of companies in the sector, known formally as Philippine Online Gaming Operators (POGOs), are forcing property firms and regulators to rethink how they handle such firms.
“We believe the market will adjust, the developers will adjust, the landlords will adjust,” Mr. Salas said in a briefing on Wednesday in Makati City.
“Again, it’s a new industry so we have to recalibrate our policies. The government, even the developers, and even among ourselves,” he added.
“It took more than 10 years for the BPO industry to reach one million employees… Roughly around five years to get to an area of 500,000 sq.m. For POGOs, (it took) two years or so… and ang laki ng scale compared doon sa development ng BPOs (the scale is bigger compared to the development of BPOs),” Mr. Salas said.
BPO companies remain the property industry’s biggest clients, taking up 244,000 square meters (sq.m.) in the first half of 2019, but POGOs are becoming a force on the market, with the sector expected to take up 450,000 sq.m. this year, he said.
He said one POGOs recently closed a transaction for seven floors of office space, equivalent to 7,000 sq.m., while another locator took up 4,741 sq.m. Both firms located in Makati City.
Pinnacle also sees the residential market being driven by Chinese clients as developers continue to add more units to cater to the demand.
“The POGO industry has taken up the space that was left by the BPOs, so it is one of the drivers of the office market,” Michael R. Mabutol, president of Pinnacle, said during the briefing.
In general, the POGOs market is coming in for more regulation because its workers are now being taxed and their entry into the country monitored more closely. The regulators with some say over the sector now include the Department of Labor and Employment (DoLE), which issues alien employment permits, and the Bureau of Internal Revenue, Mr. Mabutol said.
The Philippine Amusement and Gaming Corp. (PAGCOR) remains the licensing authority for the industry.
“Since they are the one issuing the license, maybe they can work with them monitoring these POGO entities,” Leo C. Doplito, director for research and consulting of Pinnacle, added during the briefing. — Vincent Mariel P. Galang