Search
 

Leasing Surges But Vacancy Highest Since '04

NEW YORK CITY-A 50% uptick in deals is offset by a 45% drop in effective rents, yet there are signs that the bottom is in sight.

By Paul Bubny | Updated on October 07, 2009

NEW YORK CITY-Expect an upsurge in Manhattan leasing activity during the fourth quarter that could represent as much as 45% of the volume produced in the first three quarters of 2009. It’s a signal that tenants increasingly are taking action on their space needs after months of indecision.

That being said, the big percentage increase will occur from a small base. Cushman & Wakefield projects volume of four million to five million square feet in Q4, compared to 11.3 million square feet YTD, making ’09 the weakest 12-month period in 13 years. As Joseph Harbert, COO of C&W’s New York metro region, pointed out during his company’s quarterly media briefing Tuesday, there have been years where leasing activity for a single quarter exceeded what we’ve seen in the first nine months of this year.

Manhattan’s Q3 vacancy rate of 11.1% was the highest in five years, and is projected to increase well into 2010, although at a slower pace. Net effective rents were off 45% from their peak as of quarter’s end, in a plunge that was faster and steeper than the market experienced in the last two downturns.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.