THE rent in buildings devoted to business process outsourcing will drop by 15 to 20 percent this year because of too much space for lease and the economic crisis, an analyst said yesterday.
Some 1.9 million square meters of BPO office space are expected to come on stream from now up to 2010, but only 27 percent of that has been committed for lease, according to Benedict Miranda, director for capital markets of Jones Lang LaSalle Leechiu.
“Supply is increasing but demand is declining because BPO firms are losing clients. All these things will lead to lower rental rates,” Miranda told reporters at the sidelines of the 3rd Philippine Housing Finance Forum.
He said many developers started putting up office space to take advantage of the boom in the call center business, but that sector had lost many clients—mostly from the United States—because of the crisis resulting from the mortgage meltdown.
The BPO sector could not take up all the space now available, Miranda said.
The rental rates in Makati hit a high of P1,200 a square meter a month at the height of the outsourcing boom, but they have now gone down to P700 to P800 a square meter.
As a result, developers had stopped building office space devoted to outsourcing, Miranda said.
“There is a pause in the expansion of BPO buildings,” Miranda said.
He said demand for office space would only start rising again in the second half of the year as companies in the West moved outsourcing to the Philippines and elsewhere to get cheaper labor.
But demand for condominiums would remain weak, he said, noting that some 125,000 residential condominium units would come on stream in the next four years to add to the glut.
“It will take some time for the residential sector to recover,” Miranda said.
But he was confident demand for hotel rooms and other properties aimed at the tourism sector would remain strong because of the government’s campaign to promote the Philippines as a top tourist destination. Jenniffer B. Austria, Manila Standard Today
July 2025
Nutrition Month
“Give us much more than P50 increase
for proper nutrition!”
Invoke Article 33 of the ILO Constitution
against the military junta in Myanmar
to carry out the 2021 ILO Commission of Inquiry recommendations
against serious violations of
Forced Labour and Freedom of Association protocols.
Accept National Unity Government (NUG)
of Myanmar. Reject Military!
#WearMask #WashHands #Distancing #TakePicturesVideosturesVideos
July
3 July – International Day of Cooperatives
3 July – International Plastic Bag Free Day
5 July – World Youth Skills Day
7 July – Global Forgiveness Day
11 July – World Population Day
17 July – World Day for International Justice
28 July – World Nature Conservation Day
30 July – World Day against Trafficking in Persons
Monthly Observances:
Schools Safety Month
Nutrition Month
National Disaster Consciousness Month
Weekly Observances:
Week 2: Cultural Communities Week
Micro, Small, and Medium Enterprise
Development Week
Week 3: National Science and
Technology Week
National Disability Prevention and
Rehabilitation Week
July 1-7:
National Culture Consciousness Week
July 13-19:
Philippines Business Week
Week ending last Saturday of July:
Arbor Week
Daily Observances:
First Saturday of July:
International Cooperative Day
in the Philippines
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