Iloilo took up most BPO space in 2020 – LPC
By Elijah Felice Rosales
Image source: Iloilo Business Park
MANILA, Philippines — The province of Iloilo last year posted the largest office take-up of business process outsourcing (BPO) firms, outpacing Makati, Ortigas, and Taguig in the competition for BPO investments.
David Leechiu, CEO of Leechiu Property Consultants, yesterday said the BPO industry took up nearly half or 191,000 of the 389,000 square meters in office space demand in 2020.
Roughly a third of the office spaces occupied by BPO locators were acquired in the first quarter as quarantine restrictions enforced from the second quarter to the fourth quarter prevented them from expanding their operations.
Broken down, Iloilo accounted for 48,000 sqm of the take-up last year to lead all BPO districts. Makati City obtained 35,000 sqm of the requirement, followed by Ortigas, 27,000 sqm; Bonifacio Global City in Taguig, 24,000 sqm; and Cebu, 16,000 sqm.
“We continue to be a big believer of Cebu, most of the Visayas, Clark and northern Luzon. I do think there is a lot of room for Davao and Cagayan de Oro for BPO expansions,” Leechiu said in a webinar hosted by the European Chamber of Commerce of the Philippines.
Metro Manila sustained 57 percent or 109,000 sqm of the BPO take up in 2020, but firms are starting to consider areas outside of the nation’s capital for their expansion projects.
The BPO industry added just 34,000 sqm of office spaces in the fourth quarter, its lowest in two decades, as investors had to terminate business plans as directed by their parent units in North America and Europe.
“Usually, the BPO sector would take a significant amount of space in the last quarter compared to the first three quarters of the year. This is the first time that the BPO sector has had a slower rate of growth. Even though they are growing, it was the slowest in a fourth quarter than [in] any quarter in the last 20 years,” Leechiu said.
Leechiu attributed the fourth quarter slump to the setbacks suffered by BPO headquarters in North America and Europe. As business restrictions are lifted in their side of the world, he said this may trigger investors to push through with their expansions overseas.
In the long run, the property expert said the BPO industry stands to benefit from the accelerated rollout of vaccines in Canada, the United States and Europe. He added multinationals located in the Philippines may begin to hire new agents by September at the latest.
“Now that most of the West has vaccinated and they are starting to be at a level of stability, we expect that in the second quarter, third quarter, many decisions will be made in opening up and expanding in the Philippines,” Leechiu said.
Source: The Philippine Star