BUSINESSES are flocking to the southern part of Metro Manila to take advantage of lower rental rates, with the big chunk of office supply taken up by the business process outsourcing (BPO) industry.
Compared with other major cities, the southern part of the metropolis now offers the lowest rental range for office spaces.
Data from global real estate services firm Jones Lang La Salle (JLL) showed that rental rates in the Alabang central business district (CBD) range from only P600 to P700 per square meter (sqm), the most affordable among Metro Manila cities.
Such rates are nearly similar to those in Pasig City with rentals ranging from P600 to P770 per sqm, and Quezon City and Bay City’s P600 to P850 per sqm.
On the other hand, these rates are significantly lower than Makati City and Bonifacio Global City’s, which range from P950 to P1,250 per sqm and P850 to P1300 respectivly for Grade A buildings, .
With alternative locations such as southern Metro Manila clearly enjoying a cost advantage, office space in Alabang is running out.
“[We saw] five to six times growth in the south in terms of residential land values. Meanwhile, in terms of office spaces, there’s little availability within Alabang. For this year, the supply is at 67,400 sqm wherein 73% has already been leased.” JLL Regional Director and Head of Project Leasing, Sheila Lobien, said in an interview.
“The growth of office space [is]outside the main CBD (Makati) and one of them is the south. There’s expansion in the southern area of Metro Manila,” she added.
Aside from competitive rents, Alabang offers a number of advantages – as compared with the situation in the metropolis area, Alabang is not as congested but location is likewise accessible by public transport.
“[It also] has supporting infrastructure to major CBDs and next wave cities, e.g. Skyway [and]rents are competitive compared to major CBDs,” JLL said
Among the business hubs located in the area are Filinvest City, Northgate Cyberzone, Madrigal Business Park and Alabang West.
As of the second quarter of this year, average office rental rates in Alabang have increased by 10 percent on the back of the robust demand in properties.
Land value has also been constantly going up in the area, increasing from P84,000 to P224,000 per sqm in 2013 to P225,000 to P275,000 per sqm in 2017. These just show how much potential Alabang has to grow as the next CBD in the coming years.
Office building to rise soon
A new office tower catering to BPO locators will be finished by the end of the year in Sucat, Parañaque City, easing the lack of supply in nearby Alabang CBD.
The project, Nissan Sucat Zentrum, which will have a close to 12,500sqm of leasable area, will be a building “equipped with the very needed requisites for BPO locators.”
The building, which is 8 storeys high, will have a total of six office floors, each boasting a typical floor plate of 2,081 sqm which is ideal for any BPO locators. The ground floor area will cater to some retail tenants to support the office locators.
It is also in a high foot traffic, visible zone as it is located along the busy Sucat Road and near big retail stores such as SM BF Parañaque.
“The Nissan Sucat Zentrum is offering a very modern yet functional space to world-class call centers,” JLL said.
The building will have four elevators, 57 car parking slots and 38 motorcycle slots. It also boasts a high ceiling clearance of 3 meters and has 100% back up power.
“For the BPO companies aiming to expand, we can bring them to Nissan Sucat Zentrum,” Lobien said.
The target handover for interested locators will be by October 2017.
Registration for the building’s Philippine Economic Zone Authority accreditation is ongoing.