Moving past 2017, the IT-BPM and BPO industry in the Philippines is looking to grow in 2018 and the industry is projected to further drive the demand when it comes to the office space leasing market in Manila.
According to the consultancy firm, Santos Knight Frank, the BPO industry will still lead the way when it comes to the rate of office space occupancy in the country.
“It’s still the BPO that will take lead in terms of the office space take up,” said Kash Salvador, the associate director for Investment and Capital Markets at Santos Knight Frank, said in a briefing in Parañaque City last year and quoted by GMA News.
The resurgence of BPO this year is attributed to the entry of more businesses in the country where these companies are seen to leverage the BPO industry’s customer service and healthcare shared service platforms according to the Rick Santos, the CEO of Santos Knight Frank.
“We’re seeing a lot of new captives, new BPOs coming in the Philippines,” said Rick Santos as quoted by GMA News.
Last year, the lack of growth for the local BPO industry was attributed to the restriction of Philippine Economic Zone Authority (PEZA) when it comes to the office buildings. But with new infrastructure and more office spaces designated for leasing, the same PEZA factor is seen to drive the demand for office spaces this year with BPO as tenants being the top drivers for occupancy.
“All of these BPO companies still need the space they need to grow. It’s just that the amount for viable space they can go into has been limited because of the little slowdown in the release of PEZA certificates for the upcoming developments,” Mr Salvador noted.
“Once the PEZA certificates become available then the building are completely filled. BPOs require PEZA spaces in order for them to fully enjoy the benefits,” Mr Salvador added.
Currently, the estimated total of 946,782 square meters of leasable office space are expected to boost the current supply of offices numbered around 4.5 million sqm.
Last year, offshore gaming companies that operate under PAGCOR licenses where the surprise contributors when it comes to the office leasing market. This year, offshore gaming companies are still expected to help contribute to the office space leasing market.
The country’s young workforce serves as a staging ground for investing in skill transfer; it is an ideal environment where foreign companies are looking to invest for long term as part of their global diversification of service delivery.
Despite the global scare of artificial intelligence (AI) and how it will supplant human capital roles when it comes to BPO, the Philippines IT-BPM associations are making a collective effort in order to move alongside the disruptive notion of business AI.
A successful adoption for AI where the local IT-BPM industry will deliver an innovative progress for BPO will help retain the country’s global standing when it comes to competitiveness. As the local BPO evolves with AI, it has a positive impact on the local office leasing market.
“With new technologies, new jobs will be created such as processors and IT (information technology) professionals. AI will be an opportunity to enhance the type of BPO here,” Mr Santos said.
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