As COVID-19 restrictions ease, Chinese gambling companies are returning to the Philippines to reopen business and actively seeking new office spaces.
From having practically zero demand, Philippine offshore gaming operators (POGOs) are now in need of 17,000 square meters of office space, latest data from Leechiu Property Consultants showed.
Contractions in office space take-up of POGOs also slowed by 50% during the second quarter of 2021 from the first quarter, indicating that they are on the hunt for new office spaces.
"At 135,000 square meters, contractions are at its lowest since the second quarter of 2020, as the office market begins to recover from the pandemic," the report said.
POGOs had been forced to shut down in March 2020 amid the coronavirus pandemic, with their workers returning to China. (READ: Manila office vacancy to reach peak since global financial crisis)
David Leechiu, the property consultancy firm's chief executive officer, noted that they are anticipating more leasing activities from POGOs as Philippine borders reopen for foreigners.
"What I have been told by very prominent players in the industry is that they have a revenge comeback for Philippines," Leechiu said.
He added that close to 30% left the country, but 70% stayed.
Since the pandemic, POGOs have vacated a total of 454,000 square meters of office space, resulting in a steep drop in rental rates.
Interestingly, Leechiu also noted that Senate Bill No. 2232, which aims to slap more taxes on POGOs, would be a growth driver for the sector and improve investor sentiment, as regulations become clearer.
A total of 1.6 million square meters of office space have remained vacant amid the pandemic, mostly due to the continuous contractions in the POGO industry.
More than half of the buildings with sizable vacancies in Makati City were previously occupied by POGOs. – Rappler.com