POGO expansion driving demand for budget hotels

The continued expansion of Philippine offshore gaming operators(POGOs) is also driving accommodation demand for the hospitality market, a property services firm said.

In an interview, Jones Lang Lasalle Philippines (JLL Philippines) head of research and consultancy Janlo de los Reyes said some hotels, particularly in the budget and middle market, are taking advantage of the expansion of POGO firms by absorbing demand that the residential market cannot accommodate.

“It’s serving as an alternative accommodation for them because of the lack, at least in certain areas,there’s a lack of accommodation condos that can accommodate their requirements,” De los Reyes said. He added POGO workers stay in hotels as longer-staying guests.

De los Reyes cited Ortigas and Makati as some of the areas where hotels offer alternative accommodation facilities for POGO workers.

“Hotel occupancy rates are generally steady and above 50 percent, with Paranaque leading at 92 percent followed by Pasay City at 73 percent, due to the concentration of entertainment facilities in these cities,” JLL said.

Apart from the hotel market, JLL reported that the continuous boom of POGOs in the country is creating demand for the residential leasing market, particularly in the Bay Area where a lot of POGOs are located.

“This driver is on the rise in other areas, where POGOs are spreading out and increasing presence in Quezon City and Muntinlupa,”JLL said, De Los Reyes said POGOs remain one of the demand drivers in the residential market.

“Definitely for the POGOs, or the Chinese investments is quite big, because they open a space, they require accommodation. That’s the reason why again some of the hotels are benefiting,” De los Reyes said.

JLL said offshore gaming operators from Mainland China continue to bring in strong leasing demand for the country’s office market.

“The industry is seen to stay intact after the government’s announcement ,” J LL said.