• Outsourcing demand to boost real estate market

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    Huge demand from business process outsourcing (BPO) firms will continue to grow the country’s real estate market this year, BDO Capital and Investment Corp. said.

    In a statement Friday, the investment banking arm of BDO Unibank Inc. said BPO companies will remain on the prowl for commercial and retail space as well as mixed use developments for offices and the peripheral needs of employees.

    BDO Capital President Eduardo Francisco said the BPO sector will not only encompass office and commercial establishments, but also the demand for mid-market residential properties within and around central business districts.

    “We all know that BPO employees, because of their work schedule, don’t want to stray far from their place of work,” he said.

    “As much as possible, they want to live within the vicinity of their workplace. Along with this, they prefer that their other needs be addressed by convenience stores and shopping centers that are also near where they live and work,” Francisco added.

    Proving its optimism on the real estate industry, BDO Capital said it recently inked a P10-billion fixed-rate corporate notes facility with DMCI Project Developers Inc.(DMCI Homes).

    The note holders include BDO Leasing, BDO Private Bank, BDO Unibank, Bank of the Philippine Islands, China Banking Corp., Land Bank of the Philippines, BPI Asset Management, ALFM Mutual Funds, Development Bank of the Philippines, and Security Bank Corp.

    DMCI Homes will pay the notes facility at prevailing interest rates in two parts—P5 billion in the first five years, with another P5 billion falling in seven years.

    DMCI plans to use the net proceeds from the bond sale to help refinance some of its loans and fund its capital expenditure on land banking and ongoing real estate projects.

    “This agreement is a clear show of confidence by BDO not only on the fundamentals of DMCI Homes, but also on the housing mortgage sector,” Francisco said.

    He said housing prices have increased significantly since 2014, but banks and developers still see this as a result of improving fundamentals, like growth in income and household formation, the rise of housing closer to contact center sites, and housing purchases initiated by overseas Filipino workers.

    “Demand will continue to outpace supply,” Francisco said.

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