The Skyline Review is an ongoing index of the performance of 58 of the City's Midtown and Downtown trophy buildings. The company released the first Skyline Review in fall 2006 to track how a city's office market is performing by comparing data on the buildings that lead the market. A JLL spokesperson tells GlobeSt.com that some of the Midtown trophy buildings include One Bryant Park, 499 Park Ave., 450 Lexington Ave., 885 Third Ave., 7 Times Square, and 1177 Avenue of the Americas. Downtown buildings include 140 Broadway, One Chase Manhattan Plaza, 7 World Trade Center and 1, 2 and 3 World Financial Center.
The submarket's high-end properties had rates increase nearly 3%, reaching $122.93 per sf according to the Skyline Review from $119.41 per sf in the fall 2007 Review. In the past year, Midtown trophy buildings have seen rents increase 18% from the $104.14 per sf recorded this past spring. There were 47 buildings in Midtown with overall average asking rents starting at $100 or more, and 21 buildings with overall average asking rents starting at $125 or more, according to the JLL report.
"New York's top-end spaces typically weather downturns better than the overall market, and tend to recover sooner," says James Delmonte, vice president and director of research for JLL's New York region. "During the previous down cycle, from 2000 to 2002, overall rates in Midtown fell 18% while rents for the submarket's trophy set decreased about 12%."
Delmonte tells GlobeSt.com that the Skyline Review "includes buildings that meet one or more of the following criteria: built or significant renovations since 1985, high-profile location, recognized tenant profile and/or architectural significance." He notes that some buildings do not appear in the Skyline Review but "are tracked for statistical purposes as part of the inventory of trophy buildings."
Downtown's high-end buildings had a 2.7% increase in rents, rising to $70.80 per sf the spring 2008 Skyline Review from $68.94 per sf in the fall 2007 Skyline Review. In the past year, Lower Manhattan's trophy-quality buildings have seen rates increase 6.2% from the $66.64 per sf posted this past spring. There were 10 buildings Downtown with overall average asking rents of $50 or above and four buildings with overall average asking rents of $65 or above.
According to the Skyline Review, average asking rental rates for the most sought-after spaces in Midtown Manhattan trophy buildings have increased by 6.1%, reaching $191 per sf compared to $180 per sf reported last fall. In the past year, Midtown trophy rents have increased 27.3% from the $150 per sf recorded in the spring 2007 Report. Just one Midtown building has offered spaces in excess of $190 per sf. Although JLL could not tell GlobeSt.com which particular building it was referring to, Delmonte tells GlobeSt.com that "there are a handful of properties that have had taking deals with rents starting north of $150 per sf."
The highly prized spaces in Lower Manhattan have seen very little movement in average asking rental rates in more than a year. The Review found that Downtown New York's highest-quality buildings posted an average top rent of $76 per sf, a $1 increase from the top rent posted in both the fall 2007 and the spring 2007 Skyline Reviews. In Lower Manhattan, only 7 World Trade Center is commanding average asking rents north of $75 per sf.
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Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com and GlobeSt. Real Estate Forum, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
