After Philippine President Rodrigo Duterte’s high stake meeting with President Xi Jinping, market experts expected that Philippine property stocks may perform on the uptrend.
Duterte returned to Manila on Sunday, 1 September. Officials statements released from his office have yet to make any indication that he would stop online casinos in the Philippines, particularly those that have been the favorite among Chinese tourists.
Ahead of Duterte’s China visit, investors have been dumping Philippine property stocks due to reports that he will ban online gambling.
If these reports are true, participants in the country’s real estate sector would be affected, especially those in the office and home sales segments.
To understand how the development is important for the Philippines, it needs to be highlighted that China makes up 70 percent of the Philippine offshore gaming sector.
Indeed, a crackdown against online casino seems unlikely, according to David Leechiu, chief executive officer of Leechiu Property Consultants.
Leechiu said POGOs make up for about 1.06 million square meters of office space. That number translates to about 9 percent of the Philippines 12.74 square meters of office space.
With regard to the rental fees, the Philippines can earn $219 million per year from POGOs.
Further, POGOs are also known to pay an upfront security deposit for 12 to 24 months of rent, meaning that landlords have actually earned whether or not the POGOs proceed with their business or not.
Leechiu said office demand from the Philippine offshore gaming operators or POGOS will consistently grow. If this trend continues, the Philippine’s property market will flourish.