Real Estate New York

As the industry knows, all brokerage firms gather their data differently, so statistics and findings will vary. CB Richard Ellis' Q2 2008 report shows office rents rising slightly from May to June. Overall Manhattan asking rents rose from $71.35 per sf in June from $71.25 in May, compared to $63.46 per sf in June 2007. Availability rose to 9% in June from 8.9% the month before, and absorption improved to negative 0.25 million sf from negative 0.37 million sf.

June was a strong month for leasing activity, especially Downtown, with large leases such as American International Group's sublease of 803,000 sf from Goldman Sachs at 180 Maiden Ln.; the New York School Construction Authority's 140,000-sf lease at 26 Broadway; KPMG's 118,000-sf expansion at 345 Park Ave.; and Enfatico's 98,000-sf lease at 11 Madison Ave., among others. Overall leasing activity for June, including relocation as well as renewals, improved to 2.28 million sf from 1.69 million sf in May, but YTD activity at the end of June had declined by 1.5 million sf compared to the first half of '07.

According to Grubb & Ellis, the office market reached its peak in the real estate cycle during the first quarter, as available supply continued to increase and demand for space remained sluggish. In the second quarter, the overall vacancy rate climbed 70 basis points from the first quarter to 5.6%, the largest one-quarter vacancy increase since the fourth quarter of 2001.