But Midtown will claim its portion of the pie too, he continued. “Midtown will remain steady. Buildings there that re-invest will do well because the technology, advertising, media and information sector,” which is driving activity, “ is all about creating a live/work/play environment.”

Overall, Mosler predicted, “for the year 2013 to 2014, 2.5 million square feet will be delivered and it will be absorbed. Through 2020, that number will get to 14 million square feet. This is the first time in decades that we'll see speculative development and I'm optimistic about it.”

This strong climate is driving asking rents up in Lower Manhattan, declared Gus Field, vice chairman. “The $30 deal Downtown is dead. The norm now is low-to-mid-$40s, and rents are climbing to $50s in some spots.”

The Midtown South market has held onto its status as the nation's tightest submarket for 26 consecutive quarters, and that shows no sign of abating he says. The average asking rent increased 1.2% to $60.17 per square foot. There has been a total of 3.7 million square feet of new leasing activity through the first six months of the year, which is an increase of 30% year-over-year.

Downtown too had an increase of 3.7 million square feet of new leasing activity year-over-year. Through the first six months of the year, 42% of all new leasing activity involved relocations from another Manhattan office market. A total of 28 such transactions were completed, totaling 1.6 million square feet. Last year, 1.7 million square feet of transactions were completed for the full year.

The average asking rent increased more than 7% year-over-year to $49.21 per square foot, representing the most significant increase of the three major Manhattan submarkets.

Retail also is faring well. Said Gene Spiegelman, vice chairman, “retail is the platinum investment of 2014. Demand is outstripping supply.”

Of the Downtown market, he said, “Brookfield Place, the World Trade Center and even South Street Seaport are great accomplishments and they're going to influence people for years to come. And there are major untouched projects, like Water Street.”

“Downtown will be rounded out from river to river,” he predicted. “And the growth in asking rents over the next five years will be significant. But this is a going to be a big year overall. On Madison and Fifth avenues, and in Times Square, there are big deals chasing that real estate.”

International investors are driving investor sales, asserted Janice Stanton, senior managing director, capital markets. “International real estate appetite is driving record breaking capital flows, and those buyers are driving pricing in 100% of deals.

Manhattan office sales are at an all time high on a price per square foot basis, with Midtown class A pricing at nearly $1,300 per square foot, she added. “Everyone investing in the US is investing in New York.”