Commercial real estate rentals dip towards BPO pricing
Business Process outsourcing (BPO) firms which often want to lease thousands in square footage for their operations are influencing commercialrenting rates, local realtors state.
Premium locations which once attracted rates near the US$20 per square foot ballpark are now rolling back to between US$10 and US$15 per square foot as they seek to attract lessees who may take as much as 100,000 square feet for years running.
Specifically, the decision by three business process outsourcing companies to expand in Jamaica is continuing to influence pricing in a lower direction, says President of La Maison property services group, Edwin Wint.
He notes that property owners with space to rent are finding traction for warm shells — meaning space with all the amenities required already in place, and which attract as much as US$15 per square foot.
Cold shells which must be retrofitted for use are renting for US$10 per square foot, he outlined.
Meanwhile, he noted that BPO companies are trying to secure space anywhere from 20,000 to 100,000 square feet in Kingston and Montego Bay.
“Depending on the quality of the facility, we are finding that owners are pricing to suit the BPO market for whom there is a certain price range set.”
Most in demand, he said, are warm shells with air conditioning, suitable lighting and other amenities. The best, he said, are turnkey locations where operators can walk in and start.
La Maison, he said, was searching for space on behalf of three already established BPO providers who are currently expanding. “It’s a clear sign of growth,” he commented.
Among them, he said, were some who had also expressed interest in specially designed locations to be constructed in 2017.
The names of the companies searching for new locations were not disclosed. However, several local companies said within the last month that they would be taking on large cohorts of new staff.
These were Xerox International which advertised the need for 2,500 new workers, IBEX International which disclosed that it needed 400 workers and Sutherland Global which advertised for 1600 workers.
