THE business process outsourcing sector continues to dominate the take-up of new office space development in the Philippines, but a segment that is rapidly growing as an alternative market for developers is shared office space services, with just one local service provider reporting more than 30 percent growth in its client base.
The virtual and shared office concepts are an evolution of the old “answering service” idea, where businessmen without a regular office could hire a service providing a business address, telephone number, and reception services to receive calls or mail. As technology and business has evolved, the virtual office services have expanded as well, and offer e-mail, SMS message, and fax forwarding, as well as providing work and meeting spaces to those who need them.
Who uses shared offices?
According to Luigi Santos of virtual office provider vOffice Philippines, shared office users cover a range of businesses. They vary from trading, consultancy, travel agencies, and many more,” Santos said.
One group that shared office services seem to particularly appeal to are foreign workers in the Philippines for a relatively short term, or working independently and wishing to avoid some of the hassle of renting space, securing local permits, and setting up utility and communications services. An American engineering consultant, who is working in the Philippines on a project that is expected to last four or five months, estimated that “maybe half” of the other clients in the shared office he uses, one of virtual office service provider Servcorp’s two Makati locations, are from overseas.
Entrepreneurs and other start-ups are a natural market for shared office services, which have expanded to cater to them as vOffice’s Santos explained.
“We offer different types of services to assist any start up company,” he said. “We can register their company, and we offer bookkeeping services, accounting services and many more. We would like to be a one-stop shop for these start up clients.”
At least as far as vOffice Philippines is concerned, the effort is paying off. From about 200 clients at the end of 2013, the company’s first year in the Philippines, Santos said there are now more than 1,500 clients at vOffice’s five locations in Makati and Bonifacio Global City, and that the company is adding new clients at a rate of about 40 per month, which translates to an annual growth of about 32 percent.
Based in Melbourne, Australia and founded in 2003, vOffice is present in about 30 countries, and currently has two sites in BGC and three in Makati. A sixth location planned for Cebu is “coming soon,” according to the company, but no date for its launch has been set yet.
Costs for virtual and shared office services vary widely depending on the features of the service package and the location. Based on information from several companies’ websites, including those of vOffice and Servcorp, a basic virtual office package can range anywhere from P1,500 up to P9,000 per month, with most costing between P1,800 and P3,900 per month.
A typical package includes communications and reception services, and provides workspace and meeting room space on an hourly basis per month. Most companies also offer semi-permanent office spaces, which again are priced according to features and location, and can be rented on a short-term basis (3-6 months) or even a month-to-month basis in some cases. The price range for these averages from P6,500 per square meter per month in the more economical locations, up to P13,000/sqm per month in the more prestigious addresses, such as vOffice Philippines’ One Global Place location in BGC, or Servcorp’s location in the 6750 Ayala building in Makati.