FOR global real property services company Colliers Philippines, Bacolod City has the potential to capture demand from large global outsourcing companies.
Colliers Philippines Head of Research and Associate Director Joey Roi Bondoc, in a statement Wednesday, June 8, 2022, said the Negros Occidental capital city has the skilled manpower and infrastructure to be a major outsourcing player outside of Metro Manila.
Bondoc said the highly urbanized city already hosts some of the major business process outsourcing (BPO) players and they believed that the completion of more office space is likely to prop up the city’s competitiveness beyond 2022.
“It is one of the most competitive cities in the Philippines and this puts Bacolod on the radar of major BPO investors and national property developers,” he added.
Among the major outsourcing players in Bacolod City are Ubiquity, Teletech, Teleperformance, Convergys, Transcom and Panasiatic.
The expansion of these companies as well as growing queries for office space has compelled other national developers to offer leasable space, the firm said, adding that this should lure more national developers to establish footprint in the city.
Colliers Philippines also believed that the demand for office space should also encourage national developers to build more integrated communities that offer offices, residential units, malls and institutional facilities including schools and hospitals.
Tie up with Nolitc
Colliers is encouraging outsourcing firms to consider partnering with the government-run Negros Occidental Language and Information Technology Center (Nolitc).
This should ensure a steady supply of BPO-ready college graduates as well as the upgrading of current outsourcing employees’ skills, it said.
Larger floor plates
Colliers has observed that several outsourcing firms are holding operations in multiple sites across the city.
“Hence, we recommend that developers build office towers with larger floor plates between 1,500 square meters and 2,000 square meters or 16,000 square feet and 22,000 square feet to enable tenants to consolidate operations,” Bondoc said.
Expansion site
Citing the data from the Commission on Higher Education, the company reported that Bacolod City’s colleges and universities produce nearly 14,000 graduates each year.
About a third are business degree holders while close to 30 percent hold engineering, IT, math, and medical-related degrees.
Bondoc said that in their opinion, the sufficient number of college graduates equipped with necessary skills is likely to sustain Bacolod City’s viability as a global outsourcing destination.
In 2018, Bacolod City ranked as the 89th most competitive outsourcing destination in the world based on the survey of global outsourcing consultancy firm Tholons.
In the Philippines alone more than a dozen areas are eyeing a spot in the Top 100 but only six made it to the list.
“Given its skilled manpower and improving competitiveness, we encourage tenants to consider Bacolod City when scouting for expansion sites outside Manila,” he added.
More plug-and-play offices
Moreover, Colliers believed that plug-and-play offices are feasible in the Bacolod office market as the city is one of the key health information management (HIM) and game development hubs outside Manila.
These companies, it said, are compelled to look for plug-and-play space due to the need to reduce capital expenditures (capex).
“In our view, developers should be proactive in tapping outsourcing firms’ requirements for plug-and-play and serviced offices,” Bondoc also said.
Carve out flexible workspaces
Townships developed by Ayala Land Inc. and Megaworld Corp. offer retail spaces and “developers should consider allocating flexible workspaces to freelancers and start-up financial technology (fintech), game development and software engineering firms.”
Colliers said these flexible workspaces could also serve as incubation sites for tenants.
Maximize Peza-accredited office spaces
Being in a Philippine Economic Zone Authority (Peza)-proclaimed property enables tenants to avail themselves of tax and non-tax incentives.
However, the slow proclamation of Peza facilities could derail the expansion plans of cost-sensitive outsourcing firms in alternative sites such as Bacolod City, Bondoc said.
“In our opinion, developers should look at the viability of Peza-accredited properties in the city,” he added.