CEBU is poised to maintain a prominent position on the radar of major IT-BPM (information technology-business process management) firms following the growth in office deals in the first semester of this year.
Office deals in Cebu reached 43,000 square meters, up 15 percent year-on-year, according to the latest market update of Colliers Philippines.
The province accounts for 48 percent of total deals outside the capital region which reached 90,000 square meters, up 10 percent from the same period last year.
Other provinces and cities that cornered substantial office space deals during the period include Pampanga (24,400 square meters), Davao (10,300 square meters), and Cagayan de Oro (6,800 square meters).
Outsourcing firms continue to dominate transactions in Cebu, covering more than half (56 percent) of the total office transactions.
Among the notable deals recorded in Cebu were spaces taken up by OfficePartners360, Cebu tele-net, Dexcom, BPO Seats, and Omega Healthcare.
These firms occupied spaces in Cebu Business and IT Parks as well as in fringe areas of Cebu Business Park.
According to Colliers Philippines, Cebu will remain on the radar of major IT-BPM firms given the availability of a skilled workforce, quality but relatively cheaper cost of living, good infrastructure network, and availability of high-quality office space.
“Cebu is likely to retain its stature as a major business process outsourcing expansion hub outside Metro Manila and will continue to corner office space deals from major outsourcing firms beyond 2023,” the property advisory firm said.
Bridging the gap
Moreover, Collier said Cebu stands to benefit from the return-to-office (RTO) directive of some companies as the cost of moving back to Metro Manila head offices is costlier.
It noted that implementing full RTO increases the risk of employee attrition, which can be costly for companies.
“Opening sites in provincial areas may be a viable strategy to address the RTO-WFH (work from home) gap. With this, it believes office tenants will continue to gravitate towards Metro Cebu,” Colliers said, adding that Cebu continues to be an appealing destination for industry leaders seeking to establish and expand their operations.
Moreover, amid the ongoing transformation of the workplace and the workforce, tenants will need to invest in a workplace that works.
The report stressed that occupiers should facilitate continuous dialogue with their stakeholders to determine how best they work and what can attract more talent to the organization.
“Occupiers continue to see the office as critical to employee engagement, especially for new hires. More are using the office as a recruitment tool and training floor, as it now becomes a company’s platform to encourage people to come together,” Colliers said.
Additionally, Colliers encouraged tenants to consider DE&I (diversity, equity, and inclusion) and ESG (environmental, social, and corporate governance) in their real estate strategies.
It noted that reflecting this in workplace strategy and design helps in differentiating the company and ensures retaining talent. Cebu-based landlords and tenants should be mindful of these initiatives in the workplace, Colliers advised.