NYC Market is Steady and Poised for Growth

NEW YORK CITY-Stable was the word that marked the third quarter as the overall vacancy rate for Manhattan remained at 12.5%, unchanged from the second quarter 2003 and up only slightly from 12.3% at the end of the first quarter. The average asking rents continue to soften as the overall average rent finished the quarter at $40.39 per sf, off from $41.12 per sf at the end of the second quarter.

“This is relatively healthy,” said Ken Krasnow, senior managing director, New York offices, Cushman and Wakefield, comparing it to other times of economic downturn. One key difference this time is the sublease space, where there has been active of late. “We’re gearing up for a busy fourth quarter.”

In the sales market, the biggest news, of course, was the highest price ever recorded for an office building in Manhattan–the whopping $1.4 billion Macklowe Properties paid for the GM Building. According to C & W, the sale of this trophy property is an indication that well leased, high quality assets are continuing to be sought after. They expect other trophy assets to come onto the market by year’s end including the Lipstick Building, 111 Eighth Ave., 140 Broadway and 120 Broadway.