Demand for prime office spaces to rise further The projected 30%-40% annual growth of the call center industry over the next five years will spur the cost of office space rentals to grow at an average 15% yearly. "We're back in the pre-crisis level on the office market. In addition, the trend will continue in the next three to four years. The increase is prompted by the heavy demand and no more supply", said David Leechiu, president and general manager of property consultant company Leechiu & Associates. At present, office rental costs P500 to P600 per square meter (sqm) monthly, from P280 per sqm in 2000. However, rental rates in Makati and Ortigas business districts go up to P600 to P650 per sqm, sometimes even higher. A regular call center operation in Metro Manila usually requires an average office space of P120,000 sqm. With the property market steadily recovering from years
of slump, vacancy rates in prime business areas, particularly in Makati
and Ortigas, had declined to as low 5% to 7%. A number of property firms are already planning to put up buildings for call centers and outsourced services, including some landowners who previously shelved office development plans. "The time is ripe for developers to consider larger-scale medium and high-rise office development, given that average rental rates are expected to increase by 20% in 2006," property services firm Colliers International added. Strong demand has also led to the development of 13 more business districts in Metro Manila, to rival those in Binondo (Manila), Makati City, and Ortigas Center in Pasig City. Emerging business districts: |