OFFSHORE gaming firms are continuously expanding, looking for office buildings with large floor plates, and in 2019, they will look to Cebu for their expansion, according to Colliers International.
As of the third quarter of 2018, Colliers recorded 4.8 percent vacancy across Metro Manila, which is driving offshore gaming firms to look for space outside Manila.
Colliers encourages new and expanding offshore gaming companies to continue looking for space in Cebu, Pampanga, and Laguna where the bulk of large space is still available.
These firms have also started to take up office space in key cities outside Manila, such as Cebu, Laguna, and Clark in Pampanga.
Aside from expansive office space and residential availability, offshore gaming companies need to operate in cities that have airports offering direct flights to China or areas that have direct access to and from Manila. This is one of the reasons these firms are starting to look at a number of cities in Southern Luzon.
For 2019, Colliers sees offshore gaming firms occupying between 200,000 to 300,000 square meters (2.7 million square feet) of office space, representing about 20-23 percent of projected take-up in 2019.
Colliers also sees upgraded infrastructure spurring Cebu leisure.
Aside from the modernized and expanded airport, Colliers sees Cebu’s tourism sector growing due to a number of infrastructure projects which should open new opportunities in the countryside. The completion of these projects should spur demand for more hotels and serviced apartments outside the Metro Cebu (which comprises Cebu City, Lapu-Lapu, and Mandaue) corridor.
Over the next 12 months, Colliers sees property firms taking a more aggressive approach in exploring parcels of developable land especially in the Mandaue and Mactan areas that would benefit from the completion of major infrastructure projects such as the expanded Mactan-Cebu International Airport, Cebu Cordova Link Expressway, Cebu Bus Rapid Transit, and Cebu-Negros bridge. Mandaue and Mactan are highly viable for resort-oriented townships.
However, Colliers notes some challenges ahead.
Rising interest rates could dampen low to mid-income residential demand over the next 12 to 24 months. A volatile interest rate environment could entice local developers to be more open to partnering with foreign firms.
Rising inflation could curtail consumer spending. And there could also be continuing private construction delays due to the acute shortage of skilled workers and ramped up implementation of public infrastructure projects.
Uncertainty could also surround the implementation of the second package of the Comprehensive Tax Reform Program, which proposes to reduce corporate income tax rates and rationalize tax and non-tax perks granted to foreign investors. PR