Despite Uncertainty, Office Rents Continue to Mount

[IMGCAP(1)]NEW YORK CITY-Cushman & Wakefield’s third quarter report for Manhattan’s commercial real estate market shows office rents surpassing previous all-time highs for the three submarkets of Midtown, Midtown South and Downtown, despite uncertainty in the financial markets and a decrease in overall leasing activity year-to-date. Year-to-date leasing activity for Manhattan measured 18.3 million sf at the end of the third quarter, down about 2.5 million sf–or 12.3%–from this time last year.

“The slowdown in activity may be attributed primarily to a lack of supply and the historic highs to which rents have risen,” said Joseph Harbert, Cushman & Wakefield’s CEO of the New York Metro Region at this morning’s Market Outlook breakfast presentation. “Limited office space and continued demand has put upward pressure on rental rates, to the point where we have exceeded record highs.”