Philippine IT-BPM sector accounted for 31% of the total office demand in Q1 2022, making it the biggest contributor to the local real estate market. According to real estate consultancy firm Leechiu Property Consultants (LPC), out of the 124,000 square meters (sq.m.) of leasing transactions recorded, 39,000 sq.m. were from IT-BPM (Information Technology and Business Process Management). LPC is expecting that the demand would further increase in the coming months as restrictions are eased and borders are now opened for foreign investors.

However, due to the Covid-19 Omicron variant infection surge early this year, about 26% of office lease terminations also came from the said sector. LPC reported that a total of 104,000 sq.m. of office space were vacated during the first three months of the year. The Philippine Offshore Gaming Operators (POGOs) — a sector that suffered the most contraction at the beginning of the pandemic — showed a 33% vacancy rate in the January-March period. But, fear not, LPC is confident in the property market’s recovery for the rest of the year.

Meanwhile, the impending 1 April return-to-office order gains strength on both sides of the argument. LPC CEO David Leechiu said that 95% of large companies feel that full-time office work is the fastest solution to productivity problems and data breaches that were prolific during the pandemic. On the other hand, BPOs think that work-from-home should be made available to a “wider labor pool” as the industry did not suffer losses despite lockdowns. For their part, Leechiu said that remote work could lead a “chunk of companies” to terminate their leases — which would then negatively affect the property market.