Clark remains key BPO site in CL, says Colliers International

Clark Freeport Zone and its nearby cities San Fernando, Angeles and Mabalacat remain the major business process outsourcing (BPO) hub in the Central Luzon region, says an international research firm Colliers International.

In 2016, Clark was ranked by Tholons as the 97th most attractive location for outsourcing operations in the world.

However, in 2017 and 2018 polls, the city slipped out of the Top 100 list. Despite the decline, Clark continues to attract major BPO locators and remains a key back up site for Metro Manila-based operations. Clark, together with Angeles and San Fernando, employs more than 20,000 outsourcing workers.

Among the major locators in the area are Alorica, Cloudstaff, Convergys. iQor, Sutherland, TaskUs, TATA Consultancy, Teletech, Stellar, and VXI.

The area hosts two of the largest universities in Central Luzon Angeles University Foundation and Holy Angel University; about a third of its college graduates are Business degree holders; while nearly 40% have relevant Science, Technology, Engineering and Math (STEM) degrees.

At present, Metro Clark’s BPO firms mainly provide voice and back-office services but the potential shift to higher value Knowledge Process Outsourcing (KPO) services such as animation, finance and accounting, and health information management (HIM) should be supported by a large number of STEM graduates.

This should help the city attract more outsourcing locators in the near term.

At present, Clark Freeport accounts for more than 40% of the more than 290,000 sq m (3.1 million sq ft) of office GLA in the Clark-Angeles-San Fernando corridor.

Among the major business hubs within Clark are Berthaphil and Philexcel Business Centres built by local developers.

Within the SM City Clark corridor are SM Clark Tech Hubs by national developer SM. The buildings are complemented by retail and hotel developments, as well as a public transportation terminal.

Other office towers developed by national players include One and Two West Aeropark buildings by Udenna, as well as Clark Mimosa 1 by the Filinvest Group.

In the nearby Angeles City, local players dominate. JD Nepomuceno Sons offers BPOready offices space in the city with its Entec 1 and 2 buildings while national developers Ayala Land and Robinsons Land cover the remaining 40%, with office space offered inside their respective malls Marquee and Robinsons Angeles.

The Angeles City-Clark-San Fernando corridor remains an attractive BPO destination due to its improving infrastructure backbone and the availability of a skilled labor pool. The area is also a premier leisure destination outside of Metro Manila which makes it an ideal location for foreign professionals.

In San Fernando, most of the office buildings are located along the busy Jose Abad Santos Avenue or Olongapo-Gapan road.

The SM Group’s SM Pampanga accounts for close to 84% of the sub-location’s office supply. It houses Teletech, one of the largest outsourcing firms in Pampanga.

Office vacancy across the Clark-Angeles-San Fernando corridor stood at 6% as of 3Q2018 due to continued demand from offshore gaming firms, BPO companies, and traditional, non-outsourcing firms that have been expanding on the back of a strong regional economy.

Colliers sees a vacancy of between 6% and 8% annually over the next 12 to 24 months as we factor in the upcoming office supply.

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