AYALA Land Inc. (ALI), the biggest Philippine builder, will develop 10 buildings for call centers and similar businesses, part of a $120-million plan to develop a property it leased from the Philippines' premier state university.
The first two buildings, with a combined gross leasable space of 27,000 square meters, will be completed next year, Ayala Land chief finance officer Jaime Ysmael said Monday in an interview in Makati City, where the company is based.
ALI and its rivals are accelerating the construction of offices to meet rising demand from call-center operators and outsourced service providers such as Convergys Corp. Philippine call centers may have $5.6 billion in sales by 2012 from $853 million last year, according to researcher Frost & Sullivan.
"This will be the cornerstone of the business process outsourcing move" by ALI, Nadine Javellana, an analyst at Macquarie Securities Ltd., said Tuesday.
ALI has leased 38 hectares for 25 years from the University of the Philippines, gaining a large property in the university's Diliman, Quezon City campus to develop for call-center operators and outsourced service providers. Megaworld Corp. is also involved in a similar project, Eastwood, also in Quezon City.
"Ayala's investment in the business process outsourcing sector is positive mainly for sentiment as earnings contribution should be negligible for the time being," Javellana said.
The residential and retail component of the project is aimed primarily at meeting the needs of employees of the development's tenants, Ysmael said.
"Demand will dictate the pace of construction for the rest of the buildings," he said. The company said in a statement it would spend about P6 billion ($120 million) in five to 10 years to develop the property.
ALI gained 1.7 percent to P15.25 at the noon close of trading in Manila. The stock has gained 54 percent this year, compared with a 29-percent rise in the main Philippine Stock Exchange Index.
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