SM Prime Holdings Inc., SM Investments Corporation’s property division, is preparing to make the most out of the continuous growth of the business process outsourcing (BPO) sector. The firm is further developing its properties called EcomCenter, which is located at the Mall of Asia Complex in Pasay City.
The EcomCenter houses OneEcom, TwoEcom, and the recently launched FiveEcom Center.
According to David Rafael, Senior Vice-president of SM Prime Commercial Properties, the Philippines remains as one of the leading business process outsourcing hubs in the world and it has continuously driven the demand for office space over the years. The offices in the EcomCenters are designed to offer world-class facilities and are located near major business districts, commercial establishments, transport lines, and major ports.
On top of that, industry analysts said the BPO industry is expected to earn $25 billion in revenues and employ 1.3 million direct and 3.2 million indirect employees by 2016, which is equivalent to nearly eight percent of the Philippine economy.
Meanwhile, information from real estate consultancy firm KMC Research & Consultancy reveals that office space occupancy at the Mall of Asia Complex rose by 11.8 percent in 2014 compared to the previous year. Moreover, prime properties increased by 8.5 percent to P602.60 per square meter a month while vacancy rates are seen to stay at the low end mark of two percent.
This year, FiveEcomCenter is anticipated to produce more office space supply, having 80 percent of the building already pre-leased. The total structure is said to be valued at P3 billion, and offers an estimated gross leasable area of 83,000 sqm and a gross floor area of 141,706 sqm.
The Asian Development Outlook Supplement report by the Asian Development Bank, a Manila-based lender, predicts that based on its gross domestic product, the output of the Philippines will grow by 6.4 percent this year, and 6.3 percent in next year. On top of that, sustained private investment and household consumption are considered as factors for the sustained growth outlook.
ADB is seeing steady spending activity in household consumption and private investment as May 2016, election day, draws near.
ADB noted that the slow 5.2 percent growth posted by the economy in the first quarter is due to the slowdown in exporting activity and controlled government spending.
The lending institution also stated that exports lost traction as import growth continued to expand backed by buoyant domestic demand. It also found that the overregulated public spending is due to the slow budget disbursement and caution to avert problems in the Supreme Court where some public funds were cited unconstitutional.
However, fiscal spending is expected to cause issues on the domestic side as external factors continue to pose a threat even with the strategies to improve budget execution.