NEW YORK CITY-Embracing the fact that its third-quarter briefing was held on Halloween, Colliers International predicted Thursday that 2013 will show itself to have been a “treat” by year-end. Total transaction volume for the year has a chance of exceeding $20 billion, making it one of the largest office property sales years ever—in aggregate value—second only to 2007, at $30.3 billion. Leasing appears on pace to come in at 26,000 square feet by the close of the fourth quarter, and rents don't seem ready to fall just yet, according to Joseph Harbert, president, eastern region.

“After the second quarter's blow-out performance with 9.6 million square feet of completed transactions, it was widely expected that the pace of leasing would slow in the third quarter, which it did,” said Harbert. “However, at 6.3 million square feet, the level of leasing activity was well within the normal range. Moreover, there are indications that other large leases are very close to signing. We're not seeing mega deals, but we're still seeing large ones,” noted Harbert.

In the area Colliers calls Midtown North, leasing fell a bit from the third quarter of last year—from 3.9 million square feet to 3.1 million square feet—but the pace is going strong already in the fourth quarter, with total leasing in the subdistrict of 1.5 million square feet during October.

Further, noted Harbert, “we're seeing an increase in deals over $100 a foot, and a few that were recently announced were even over $150.” Landlords appear to be seizing on the healthy levels of activity, as Harbert and several brokers noted that concession packages are “getting skinny,” particularly along Park avenue.

Over in Midtown South, rents are up nearly 50% from their 2010 trough of about $30 in 2010 to $56.96 and “I don't see that attenuating,” Harbert said. He predicted that tenants will start to say uncle at the $75 to $80 per square foot level, but several brokers in the room said $65 to $70 would likely be tenants' breaking point.

Measured against the total amount of space in each market, the Penn Plaza/Garment district in Midtown South and the Plaza District in the Midtown North market were the most active submarkets in the third quarter.

Downtown, leasing is on track to exceed 2012 levels, with the third quarter yielding more than 1.2 million square feet of agreements, compared to 1.15 million in Q3 2012, coupled with the nearly 366,666 square feet that changed hands in October. The area has the biggest spread between taking and asking rents, with building owners generally collecting about 80% of what they wished for, Harbert reported.

The Manhattan office property sales market has been dominated by core office properties, including the $1.36 billion sale of a 40% stake in the General Motors Building at 767 Fifth Ave. for $1,890 per square foot; the $858 million sale ($900 per square foot) of a 49% interest in the News Corp. building at 1211 Ave. of the Americas; and the $385 million sale of 499 Park Ave., which came to $1,285 per square foot.

Another $5 billion worth of Manhattan office sales are currently under contract and are expected to close by year end, Colliers reports, including the $694 million sale of a 49.5 percent interest in 7 Times Square for $1,170 per square foot and the $725 million sale of 1345 Ave. of the Americas for $725 per square foot. Additional core properties are being marketed with the potential to close this year.

“Pricing for Manhattan office properties will continue to push towards record territory,” said James Murphy, executive managing director. “Overall Manhattan office rents have come back over the last two years, and investor confidence rests at a five-year high. Investors are projecting continued healthy rent growth and are making investment decisions accordingly.”