MANILA, Philippines — Manila could see its flexible workspace area grow by at least 10% annually in the next three years amid the emergence of micro, small and medium enterprises and influx of multinational corporations, real estate services and investment management company Colliers International said in a new report.
Flexible workspace is a type of office space that can be occupied immediately and gives business owners access to basic office equipment on shorter-term leases.
According to Colliers, Manila’s flexible workspace area will likely expand over the next three years on the back of continued rise of MSMEs and entry of multinational companies and outsourcing firms looking for plug-and-play offices.
Implementation of policy reforms that aim to improve business climate is also expected to boost the sector.
In 2018, Colliers recorded flexible workspace supply of about 3.8 million square feet, up 14% from 3.2 million square feet in 2017. This accounts for about 3.2% of the total Metro Manila office supply.
Among the foreign players already in Manila are Common Ground and WeWork. Meanwhile, Philippine developers Ayala Land and Robinsons Land have ventured into the flexible workspace business.
“The tight Metro Manila office market, coupled with the emergence of a mobile workforce and multinational corporations looking to bring down operating costs and provide flexibility to their employees, has given rise to another office sub-segment – flexible workspace,” Colliers said.
“The segment’s growth has been supported by the improvement of the country’s IT infrastructure, especially after the entry of a third telecommunications company committed to improving nationwide broadband connectivity,” it added.
In a statement, Colliers International Philippines director for office services Maricris Sarino-Joson said operators should cash in on the rising demand for flexible workspaces by partnering with developers to carve out co-working space within malls, residential condominiums, hotels and worker dormitories.
“Large flexible workspace operators should consider partnering with officials of second-tier cities that are viable outsourcing destinations. The project teams of outsourcing firms could start operating in co-working facilities in these cities where they could train college students that the BPOs could tap in the future,” Sarino-Joson said.
“Among the most attractive second-tier cities for BPO operations are in Cebu, Bacolod, Iloilo, Clark in Pampanga, Laguna, and Davao,” she added. — Ian Nicolas Cigaral