As the information technology-business process outsourcing (IT-BPO) industry continues to drive demand for office space, it was observed to have also influenced demand in the residential sector.
In a report, real estate consultancy group CBRE Philippines said the growth of the BPO industry has transformed the central business districts of Makati and Taguig into BPO hubs.
“These hubs have evolved into new ecosystems, whereby the establishment of one BPO center has resulted in the birth of new commercial and residential development in the same area to support the needs of BPO workers,” the CBRE report said.
CBRE noted that the positive performance of the IT-BPO industry is contributing to the demand for residential space, driving the development of mixed-use projects with residential components.
“Developers are also taking advantage of this growth, by building where BPO companies are located, whether it is in the main central business districts or fringe areas,” the report said.
Similarly, CBRE said high-end and luxury condominium developments also contributed to the demand for residential units in the third quarter of 2015, specifically among expatriates.
The report noted however that despite its strong performance, the residential sector somewhat softened in the third quarter of last year, due to a slowdown in project launches, especially among the affordable and mid-end developments.
In a separate report by Colliers International, another real estate advisory firm, a slowdown in project deliveries in the major CBDs were likewise noted, as only three projects were completed during the three-month period.
“Only three projects in the major CBDs were completed during the third quarter, with two other projects sliding in their delivery dates,” said Colliers.
However, Colliers noted that despite the slowdown in project deliveries, vacancy rates in the CBDs have increased due to recent completions, which are now being put into the market.