Rising AI Costs May Bolster PHL Outsourcing Competitiveness

The outsourcing industry could remain competitive against artificial intelligence (AI) as the rising cost of “tokens” to operate the technology could deter companies from total automation, according to property consultant Jones Lang Lasalle (JLL) Philippines. While the firm remains cautious about AI’s potential to reduce office footprints in the long term, it expects 2026 to be a “banner year” for the real estate market, buoyed by a “flight to quality” among occupiers and the mixed-use rezoning of key districts like Makati. JLL Philippines Country Head Joey Radovan noted that the cost of tokens required to operate AI platforms, citing Claude Opus 5’s prices at $5 to $25 per million tokens, is becoming a significant factor in corporate decision-making. He said that as AI firms transition to public markets and face profitability pressures, these operational costs may hit a ceiling that favors human labor. “My new thesis is if it becomes more expensive, then we might just revert to human agents,” Mr. Radovan said, noting that traditional outsourcing remains cost-driven. “I’m thinking the eradication of these call center agents may not happen… the only chance we have for AI not to eradicate the jobs is that OpenAI and (others) go public. Once they’re public, they come under pressure to be profitable.” However, the firm remains wary of how automation could eventually reshape the workplace, particularly for bench workers in call centers. Mr. Radovan warned that if AI takes over these roles, 70% of a floor might not be needed which requires smaller office requirements and less need for collaborative spaces. JLL Research Head Janlo de los Reyes said that while AI is an increasing factor in corporate real estate decisions, its large-scale impact on office footprints has yet to be fully realized. According to the firm’s Future of Work 2026 survey, 79% of organizations recognize the need to evaluate AI’s impact, only about 18% to 19% have taken concrete action regarding their workforce. “It’s a consideration, but not a large driver in terms of office-based action,” Mr. de los Reyes said, adding that many firms are still looking at increasing headcount despite AI adoption. Instead, the market is currently being shaped by a “flight to quality” as occupiers take advantage of softer rents to secure premium addresses. “We want to make sure that we have a premium address… to be able to attract talent,” Mr. de los Reyes said, noting that building quality and location remain the primary drivers of rental growth and occupancy. — Juliana Chloe A. Gonzales