MORE local government units (LGUs) must allow Philippine offshore gaming operators (Pogos) within their areas of jurisdiction to keep vacancy rates in their respective office markets manageable.
Pronove Tai International Property Consultants (PTIPC) cited, in particular, Quezon City, Mandaluyong and Taguig to accommodate Pogo locators.
“These cities have the highest vacancy rates,” said Monique Pronove, CEO of PTIPC.
Based on the company’s 2017 Metro Manila Office Market Overview report, the level of unoccupied office spaces in Quezon City is at 11 percent.
This is followed by Mandaluyong at 8 percent and Taguig City at 7 percent.
“Once Lonos [Letters of No Objection] are given to Pogos in these areas, there will be better opportunities for the sector to further grow,” she pointed out. At present, Makati and Pasay are the only two LGUs that issue Lonos to offshore gaming operators in the country.
Despite this, Pogos still have a strong absorption of office spaces in the local real-estate industry, preleasing 35 percent, or 275,000 square meters (sq m), of the total stocks last year.
“While we noticed a slowdown in IT-BPM [information technology-business process management] take-up, Pogos buoyed us over in 2017,” Pronove noted.
“If not for this sector, vacancy rates would have gone up to 8 percent in Metro Manila,” she added.
Apart from propagating offshore gaming to other areas in Metro Manila, PTIPC called for more support from the government to pump prime the office market even further.
Pronove recalled that locators had a “wait-and-see attitude” in 2017, given their various concerns, including unclear initial licensing authority for Pogo.
Meanwhile, the issues confronting the back office sector are the threat of revocation of tax incentives in accordance to Philippine Economic Zone Authority (Peza) law for IT-BPM and the slow Presidential proclamations of Peza buildings.
On the overage, it takes a six-month turnaround time before an office building within Peza will be proclaimed.
In the last 17 months, only five out of 22 Peza-building applications were proclaimed in Metro Manila, indicating a slow take-up of office space from the IT-BPM players.
“There are still P42 billion worth of Peza applications in 2017 that are pending approval,” Pronove said.
Founded in 2002, PTIPC provides expertise and quality services, such as research and consultancy, landlord and tenant representation, property sales and purchasing, and property-portfolio management.
To date, the homegrown property-services firm has had P13 billion worth of transactions in different market sectors like office, retail, industrial and petrol with over 1.2 million sq m of leasable space transacted.