Property consultants in the Philippines are crediting the rise of the Philippine Offshore Gaming Operator (POGO) sector to the influx of Chinese capital.
Chinese companies with POGO licenses have turned their attention to the country’s property market, which could be attributed to China’s One Belt One Road program.
For instance, the office sector has seen a larger demand from offshore investors to convert decrepit buildings into offices for business process outsourcing (BPO) and online gaming facilities.
Some experts believe that the emergence of POGO-licensed Chinese firms may have saved the Philippine property market in 2017. The industry became concerned about a cyclical downturn after growing for several years since the global financial crises in 2008.
But thanks to the BPO sector, those concerns somehow dissipated based on industry data. Leechiu Property Consultants said that office absorption in Metro Manila comprised 775,000 square meters in 2017, up 23% from 630,000 square meters in 2016.
BPO firms accounted for less than 50% of the occupied space, while online gaming companies took up around 30%. The trend may continue this year, as China looks to expand its investments in Southeast Asia.
China’s $1 trillion OBOR program will indirectly benefit the Philippines’ property market, as both countries have been working more closely to develop their infrastructure. This partnership will be mutually beneficial over the mid- to long-term period.
While the BPO sector’s office absorption somehow mellowed down, the Chinese online gaming industry has been picking up the slack. In Metro Manila, investments in new office buildings have trickled down to the construction of residential towers.
Most offshore companies have sought an adjacent place where Chinese workers can stay while in the country.
China’s growing appetite for Philippine properties may indicate further demand for property development. Whether you plan to sell or buy real estate, it’s important to seek expert advice first to determine the best course of action for a deal.