Ayala Land Inc., the real-estate arm of conglomerate Ayala Corp., announced it would build a P3-billion retail and office complex on a 12-hectare property in Camp John Hay in the northern resort city of Baguio.

In a disclosure to the stock exchange, company senior vice president Jaime Ysmael said ALI had signed a land lease agreement with Camp John Hay Development Corp. for a 120,636.92-square-meter lot within the John Hay Special Economic Zone at Camp John Hay.

Ysmael said the property, according to preliminary plans, would be developed into a mixed-use complex with retail and business process outsourcing (BPO) facilities. The development will have about 40,000 square meters of BPO office space and support facilities and about 7,000 square meters of retail area.

The initial project cost is estimated at P3 billion.

Ayala Land spokesperson Alfonso Reyes said the BPO component would consist of six buildings of four stories each and would house about 6,000 seats. This will be the first BPO facility in Camp John Hay.

The lease agreement, which took effect July 1, will be for 39 years.

Groundbreaking for the facility is scheduled for the second quarter of 2009.

?Baguio City is an attractive area for BPO expansion with its quality of graduates and temperate climate that lures clients to locate there,? Reyes said.

Camp John Hay consists of two parcels of land: the Camp John Hay former US military reservation that covers 695 hectares, and the 247-hectare rest-and-recreation resort facility. The latter is now called the John Hay Special Economic Zone and is leased to Camp John Hay Development Corp.

Of the 247 hectares, 48.43 hectares or 20 percent is occupied by a golf course. Only about 22 hectares, or nine percent, have been designated as areas where development is allowed.

The remaining areas will be maintained as managed forests, making the camp an ideal ecotourism destination for both local and foreign travelers.

Aside from its foray into BPO development in Baguio, Ayala Land said completion of several BPO projects between 2008 and 2009 would add 190,000 square meters of gross leasable area in its development projects.

The company?s current BPO-related projects include the six buildings of the University of the Philippines TechnoHub in Quezon City, Nuvali Technopod Building 1 in Laguna province, the BPO component of Glorietta 5 mall in Makati City, the De la Rosa E-Services in the Makati business district, the San Lazaro Building 1 in Manila, the BGC E-Services in Taguig City, and the Cebu eBloc in the central Philippines city of Cebu. Edited by INQUIRER.net