MANILA, Philippines - The online gaming sector is projected to account for a large chunk of office space demand this year driven by the issuance of Philippine Offshore Gaming Operators (POGO) licenses, a property consultancy firm said.
In a briefing Tuesday, Leechiu Property Consultants(LPC) chief executive officer David Leechiu said the online gaming industry has suddenly become the second largest demand driver for office spaces in Metro Manila, next to the business process outsourcing (BPO) sector.
“The biggest surprise for us is online gaming. They went from zero to now the second largest demand driver for office space,”Leechiu said.
Leechiu said a total of 84,000 square meters of office space had been taken up by online gaming firms in the past six months.
He added the industry also accounts for 17 percent of the 477,928 sqm of pre-committed space for 2017, making it the second-largest demand driver after BPO, which comprises 38 percent of the pre-commitments.
For this year, LPC projects office space net take up in Metro Manila to reach 750,000 to 800,000 sqm, higher than the 630,000 sqm take up in 2016.
“This online gaming market could easily consume about 400,000 to 500,000 sqm of office space,” Leechiu said.
Leechiu said the demand for office space is coming from 35 online gaming firms which have received POGO licenses from the Philippine Amusement and Gaming Corp. late last year.
The property analyst said each firm could easily take up about 10,000 to 20,000 sqm of office space.
Leechiu expressed his overall optimism about the country’s property market, driven by the continued pre-commitment trend in the industry.
“That’s the indication of the confidence the tenants have in the market,”
Of the 1.2 million sqm. of office space slated to come online in Metro Manila this year, only 61 percent is available to the market as 34 percent has been pre-leased and five percent is under negotiation.
“Despite the increase in supply, we think there will be an equilibrium between supply and demand this year,” Leechiu said.