Arthur Anderson's recent backing out of Times Square
"A flight to quality is definitely happening right now," the spokesperson tells GlobeSt.com. "Companies whose leases are up have made the move to a higher-class property, although at rates higher than what they were paying for class B or C space." The report states that while asking rents overall in Manhattan have slumped 5.6% since Jan. 1, Downtown prices have fallen only 3% this year, offset in part by federal incentive packages to attract and retain corporate tenants in the area. Class A average rents sit at $60.96 for Midtown and at $55.72 for Downtown before subsides, according to the report.
"It's business as usual in the Downtown market, as long as developers can find an anchor tenant," notes the spokesperson. The vacancy rate for the Manhattan office market sits at 9.9% for May, up from 6.6% a year prior.
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