Philippine offshore gaming operators (POGO) may make their comeback on domestic soils this year as they begin to survey for office space vacancies in Metro Manila and other areas.
POGOs are seen to take up around 12 percent or 31,000 square meters of the 266,000 sqm in office space requirement in 2021, according to data from a real estate broker.
David Leechiu, CEO of Leechiu Property Consultants, said the controversial operators of online gambling may just find their way back into the Philippines with the legislation of a measure that seeks to legitimize their enterprises.
The House of Representatives in February passed House Bill 5777 that charges POGOs with a five percent tax on gross revenue. Also, the measure requires foreign nationals working in POGOs to pay a 25 percent tax on gross income.
Similar bills were authored in the senate by Sen. Ralph Recto and Sen. Imee Marcos. Recto proposes to tax POGO workers by 30 percent, while Marcos copies the 25 percent rate of the House.
According to Leechiu, POGOs can transform the Philippines into the Macau of online gaming in their return here, as their activities will now become legal, as regulated not only by the Philippine Amusement Gaming Corp., but also the Bureau of Internal Revenue (BIR).
Further, Leechiu said POGOs are expected to reverse losses incurred during the lockdowns by multiplying their investments in locations where they operate.
In the Philippines, POGOs have stopped acquiring new office spaces since the second quarter of 2020, as they wait for congress to approve legislation that will legalize their enterprises.
“They did not have any new leasing in the last nine months attributed primarily to the efforts of the BIR to choke them. We believe that this will change by June [through] a law being drafted to reopen that industry and give them a legal platform into this country,” Leechiu said in a webinar last week.
With POGOs out of the picture, business districts across Metro Manila witnessed office spaces emptied out in a matter of one year. POGOs have terminated contracts on 396,000 sqm of office spaces since the pandemic erupted in the first quarter of 2020.
Leechiu explained this wipeout affected mostly Makati’s property owners, who leased their units to these online gambling firms and now maintain 109,000 sqm of idle spaces.
On the other hand, Leechiu warned that attracting the China-based POGOs to relocate here may be difficult to do now, especially that the government is demanding Beijing to pull out its ships from the Julian Felipe Reef in the West Philippine Sea.
Article and Photo originally posted by Property Report Ph last April 18, 2021 and written by Elijah Felice Rosales.
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