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Rent Increases Continue

NEW YORK CITY-Rents continue to edge upward as the year ends, according to research reports. One key factor is rising employment in Manhattan.

By Barbara Jarvie | Updated on January 02, 2006

NEW YORK CITY-In the past year, average asking rents for class A space have gone from $55.29 per sf to $58.34, according to Grubb & Ellis. In the third quarter, the average asking rent was $57.52.

In Midtown, where the vacancy rate at the fourth quarter in 2004 stood at 9.3%, it’s now 6.6%. Asking rent for class A space in the fourth quarter was $64.68, as compared to $63.76 in the third quarter. For the fourth quarter of 2004, average asking rent was $59.78. Total absorption at the end of 2004 was 4.1 million; at the end of 2005, absorption was 5.7 million.

For Midtown South, class A average asking rent in the fourth quarter was $40.64. That represents an increase from $38.33 in the third quarter and $34.13 in the fourth quarter of 2004. Total absorption in 2005 was 2.7 million sf, as compared to 958,750 sf in 2004. The average asking rent for class A space in Lower Manhattan was $36.59 per sf in the fourth quarter of 2005. That represents an increase from $35.64 in the third quarter, but a slight decrease from $36.76 for the fourth quarter of 2004. However, the area has experienced absorption of 940,768 sf in 2005, as opposed to negative absorption of approximately 1.3 million sf in 2004.

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