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Space lack spurs POGOs to move outside Manila

 

THE Philippine offshore gaming operator (POGO) sector is expected to expand outside Metro Manila as its demand for residential and office spaces continues to grow, according to a property services firm.

At his company’s 2020 real estate market overview and outlook briefing in Makati City on Thursday, Jones Lang LaSalle (JLL) Philippines research and consultancy head Janlo de los Reyes said the industry would “continue to maintain its [growth] momentum in 2020.”

A “lot of the POGOs are actually moving outside [of] Metro Manila…because of lack of space,” he added.


According to him, the industry’s space requirements mirror the business process outsourcing’s (BPO), which is between 5,000 and 20,000 square meters.

“This volume of stock is not something that you would find in Metro Manila,” de los Reyes said.

POGO demand in the provinces of Pampanga, Laguna and Cavite are increasing, he added.

This year, JLL said, POGO clients sought 20,000 sqm of office space in Pampanga’s Angeles City and Clark; 20,000 sqm in Laguna’s San Pedro City; and 20,000 sqm in Cavite.

Besides the limited space, de los Reyes cited the policies of some local government units as prompting some POGOs to leave Metro Manila.

The Makati city government ordered last month a moratorium on the issuance of new business licenses to POGOs because of their excessive market takeup.

They also affect other segments of the real estate landscape, according to de los Reyes.
“POGOs [also] go to hotels for [their] housing [needs], driving up hotel occupancy [and] also lease supplementary retail spaces from 100 sqm up to multifloor [food and beverage] spaces,” he explained.

The sector has also been driving office rental rates in the last decade due to increasing demand. Makati, Muntinlupa City and the Bay Area registered growth of 52.3 percent, 118 percent and 45.8 percent, respectively.

Office takeup for POGOs rose by 76 percent to around 800,000 sqm in 2019.

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