Last checked at 
GRAPHIC: New office space: http://link.reuters.com/pyn24w
By Neil Jerome MoralesMANILA, Feb 25 (Reuters) - Supply of new office space in Manilais set to break records for the next few years as developersscramble to satisfy demand from global firms such as Google andHSBC looking to outsource business processes to Asia's secondfastest-growing economy.
Developers added 466,354 square metres (sqm) of office spacelast year, near the all-time high of 467,030 sqm in 2009,Colliers International Philippines said in a report this month.That's almost equal to the floor area of two Empire StateBuildings and enough for tens of thousands of employees. A totalof about 1.85 million sqm of office space is expected to beadded between 2015 and 2017 in the Makati, Bonifacio GlobalCity, Ortigas and Quezon City business districts in MetroManila, according to Colliers.
More than half of the supply entering the market this yearhad been leased as of February, Rick Santos, chairman ofproperty services firm CBRE Philippines, told Reuters. Loweroperating costs and an English-speaking workforce have luredfirms such as Google, Accenture, Citigroup, JPMorgan and HSBC to relocate some oftheir business processes to the Philippines.
The demand for office space has boosted average lease ratesin the capital by 8 percent to 816 pesos ($18) per sqm as of theend of 2014, compared with a 4 percent gain in 2013, data fromCBRE Philippines shows. Meanwhile, the vacancy rate in businesshubs in Manila - the No.2 outsourcing destination afterBengaluru according to strategic advisory firm Tholons - fell to4-5.5 percent in 2010-2014 from 9 percent in 2009.
Local property players Megaworld and Ayala Land, whose shares have soared by more than a third in thepast year on the local bourse, are ramping up supply. "We haveclose to 200 tenants in our portfolio, so we already know theirgrowth requirements, and that prompts us to create the supply,"Megaworld Senior Vice President Jericho Go told Reuters. "Wedon't foresee a major risk."($1 = 44.1500 Philippine pesos) (Editing by Ryan Woo)
