Lifting moratorium on NCR ecozones seen to boost IT-BPM job creation
LIFTING the moratorium on new economic zones (ecozones) in the National Capital Region (NCR) is expected to attract new Information Technology and Business Process Management (IT-BPM) companies to the Philippines, according Leechiu Property Consultants (LPC).
This as the Philippine Economic Zone Authority (PEZA) earlier said it expects Malacañang to lift the moratorium within the year.
“Opening up applications for new Metro Manila PEZA locations will encourage new tenants and hasten new employment,” LPC said in a statement.
LPC said the move would help the IT and Business Process Association of the Philippines achieve its target of creating 1.1 million jobs by 2028, as well as another 3.3 million in indirect employment.
Issued by then-President Rodrigo R. Duterte in June 2019, Administrative Order (AO) No. 18 declared a moratorium on the approvals of new ecozones in the NCR in order to boost countryside development.
LPC noted the AO No. 18 “created a barrier to entry for new IT-BPM tenants preferring to locate in Metro Manila.”
“IT-BPM companies have been the primary growth driver of Philippine real estate for more than 20 years. New IT-BPM entrants typically open their headquarters in the National Capital Region, which has about 70% to 75% of the industry headcount as of 2021, and only after will be willing to expand to the provinces,” it said.
The Philippines is one of the few countries experiencing net positive absorption in the office sector, LPC said.
“The Philippines will be further boosting this growth by making available another 2.8 million square meters (sq.m.) of office space in the next 10 years; of which, 1.8 million sq.m. will be in Metro Manila. IT-BPM tenants will likely remain as the primary takers of this office space,” it said.
Year to date, office demand has reached 554,000 sq.m., with LPC projecting another 500,000 sq.m. demand for the second half.
“While office absorption is moving towards pre-pandemic levels, the lifting of the moratorium will bolster further growth benefiting projects in Metro Manila, as well as in the provinces,” LPC said.
