CEBU, Philippines — Despite some developers’ decision to re-start construction of delayed projects and postponed plans due to the pandemic, Cebu’s office market is seen to reach its lowest since 2013.
Colliers Philippines’ study revealed that Metro Cebu office market is experiencing a turbulent period. Segments that drove demand in the past five years, such as POGOs and outsourcing firms, are either vacating spaces or rationalizing their office footprints.
Providers of English as a Secondary Language (ESL) services have also been downsizing while some traditional occupiers have closed shop, raising vacancies.
Aside from anemic demand, the Cebu office market is also seeing disruptions in supply with new office completion, Colliers recommends that landlords be more proactive in responding to tenants’ requirements while tenants should complement their office set-up with remote working schemes.
However, according to Colliers Philippines head for research Joey Roi H. Bondoc, despite the projected softening in office space demand, Cebu remains to be in the radar of big and small Business Process Outsourcing (BPO) firms, and this provides hope for the projected slump.
The softening of the demand may not take long as office vacancies left by Chinese POGO can be easily occupied as more BPO companies are now planning to open up or expand operations in Cebu.
This means that amid closures and streaming down of workforce of some businesses especially those in the tourism sector, Cebuanos could count on brisker BPO employment opportunities.
Despite the work-from-home (WFH) arrangements adapted by some BPO companies and other industries, Bondoc believes fast recovery of office occupancy rate in Cebu in short term.