This week, Colliers Research provides insights on local business groups urging the incoming new administration to continue the policies of President Duterte to attract more foreign investment and sustain economic group; and Blackstone Group subsidiary Mphasis Corp. planning to establish BPO operations in the Philippines, which can potentially create between 1,500 and 2,000 call center jobs.
Biz groups seek continuity of policies for growth
SUMMARY
The Philippines’ major business organizations are seeking continuity of policies to attract more foreign investments and sustain economic growth. Based on partial results, former senator Ferdinand Marcos, Jr. is poised to win the presidential elections. The Joint Foreign Chambers (JFC) intends to continue working with the government to maintain high levels of economic growth as well as sustain infrastructure development and employment generation. Meanwhile, the British Chamber of Commerce Philippines wants the new set of leaders to continue implementing reforms introduced by the Duterte administration.
RESEARCH VIEW
Colliers Philippines believes that the Philippine economy’s potential to accelerate beyond 2022 will likely hinge on the implementation of crucial reforms that should support the inflow of more foreign direct investments and creation of more jobs. In our view, the expansion of more outsourcing firms in the country should positively influence office space absorption within and outside Metro Manila. Meanwhile, attracting more foreign retailers is likely to contribute to improved physical mall space take-up. Colliers believes that continued inflow of manufacturing investments will likely be crucial in sustaining industrial land and warehouse take-up. Colliers believes that infrastructure implementation and decentralization will both play an important role in supporting the property development sector’s growth. These key economic programs will likely dictate property firms’ development and expansion plans over the next three to six years.
US firm eyes BPO presence in country
SUMMARY
The Department of Trade and Industry (DTI) said that information technology (IT) company Mphasis Corp. is planning to establish business process outsourcing (BPO) operations in the Philippines. Initial headcount is estimated between 1,500 and 2,000 call center jobs. Mphasis is a subsidiary of New York-based Blackstone Group, which provides IT-based services to healthcare, banking, finance, logistics, telecommunications, and other high-tech industries. At present, Mphasis has facilities in India, Mexico, Taiwan, Costa Rica, Germany, and the United Kingdom. Earlier, DTI highlighted the country’s advantages as an outsourcing destination, including a skilled manpower and tax incentives.
RESEARCH VIEW
Office transactions in the capital region reached 146,100 square meters (1.6 million square feet) in Q1 2022, up 30% YOY. We saw more BPO and knowledge process outsourcing (KPO) companies occupying space in Metro Manila. Some of the notable transactions include Facebook in Fort Bonifacio and Arcadis in the Makati central business district (CBD). Colliers encourages foreign firms keen on establishing their headquarters in the country to consider these major CBDs for their expansion plans. Fort Bonifacio and the Makati CBD house several multinational firms, as well as Premium and Grade A office buildings. Tenants should also explore provincial locations and take advantage of the attractive lease rates and available and skilled talent pool. Outside Metro Manila, we see sustained demand in Cebu, Pampanga, and Iloilo as these areas accounted for 99% of total provincial office deals in Q1 2022. Latest provincial transactions involving outsourcing firms include Concentrix and 24/7 Intouch Philippines.
