Location still key to cyber corporations

In this age when companies are increasingly turning from bricks to clicks, the three things that count in real estate remain the same – location, location, location.

This is why Greenfield Development Corp.’s Edsa Central IT Center, nestled at the nexus of the country’s busiest highway, is using its location to keep a leg up on the competition in the crowded real estate market for call centers and other business process outsourcing (BPO) providers.

Jericho P. Go, Greenfield Development Corp. vice president for business development, said there were just some things that you cannot change in the real business because even high-technology companies have old world needs, particularly quick-access to transportation which was vital for a labor-intensive business like IT.

"We can compete evenly on price and other specifications but nobody can beat us in terms of location because we are one of the few projects that have virtually 24-hour hour service for buses, jeepneys and tricycles," said Go. "Not all of them (call center workers) drive cars or have chauffeurs."

Aside from its accessibility, Go said Edsa Central’s location outside the central business districts make it a more practical bet for call centers and other BPO providers wanting to stay in the country for the long haul.

"People forget how important location is in a service business especially in times when there is a glut in office space and low-price centers like call centers dictate the market. But when office rent starts going up, call centers are forced to move out of Makati and Ortigas and seek areas with more affordable rent," said Go.

He noted that call centers initially converged in Makati and Ortigas because of the real estate slump where landlords were desperate to fill up their newly-finished buildings and the old building left by tenants. "It was an unnatural situation. The tenants were forced to make do with their sites not prepped for high-tech firms. This made their start-up costs higher and their operations inefficient," Go said.

Go said this trend was happening now in Makati and Ortigas with landlords upping the trend as demand for office space swells. "Call center operators and other BPO providers are realizing the benefits of going into areas that have a natural 24-hour transport service and structures that address the space and security needs of high-tech firms," Go said.

Go said most IT firms, both existing and incoming players, preferred structures that were built specifically for their needs rather than old structures that were retroffited to accommodate their needs for high-tech cables, wider floor space and faster elevators.

" We have the advantage over other developments that used old legacy system or old phone cables. It’s like we’re operating on a Pentium M technology while they’re still in a Pentium 1 system," Go said.

Go said that the 8,000-square meter floor space allocated for Greenfield’s IT Center I pavilion have been fully booked just a few months after opening. Greenfield expected the IT Center II (which converted an old Uniwide Warehouse Club branch into a low-rise, high-tech facility) to be fully booked by the time it opened in June this year.

"Our challenge now is to step up in the construction of more facilities because office space for IT companies is becoming scarce. Demand is so far ahead supply right now," Go said. Greenfield is currently finalizing the design for its 12-story IT Park building which is being targeted for opening by early 2008.

Greenfield’s rush to build IT facilities is in line with its ongoing redevelopment of the 20-hectare Edsa Central facility where up to two hectares have been earmarked for building IT facilities that would mesh with its other retail and residential projects.

16,000-square meter Edsa Central IT Center II renovate and add one floor to the former Uniwide facility.

"Stand-alone and low-rise – features that are very important to security, 12-story Edsa Central IT Park, also located in the 24-hectare mixed-use property of the company in Mandaluyong City. This is expected to be completed by the fourth quarter of 2007.