“The decline in year-over-year new leasing activity can be attributed to the decline in the number of large leases signed—only five new leases greater than 100,000 square feet were inked in 2016, compared to 10 leases one year ago,” the report states. Overall asking rents increased $0.82-per-square-foot during the first quarter to $72.40-per-square-foot.

A key indicator that the New York City economy remains strong is that the unemployment rate fell 90 basis points in the last 12 months, (to 5.4% as of February 2016).

In the past year, an additional 111,600 jobs were added to the city's public and private workforce, bringing total employment to more than 4.3 million jobs. Office-using employment increased by 2.9% during the year, led by professional services adding 27,000 jobs. In addition, the New York City population reached an all-time high with more than 8.5 million people and has grown by 375,000 residents in the last five years.

A key takeaway from the C&W snapshot report included the financial services industry being the key driver for office leasing in Midtown, accounting for more than one-third of all leasing activity in the first quarter in that district.

During the first three months of 2016, Midtown overall asking rents increased 2.3% to $78.42-per-square-foot, surpassing its 2.0% increase throughout all of 2015. Class A asking rents were 2.3% higher at the end of the first quarter to $83.54-per-square-foot. The Midtown vacancy rate increased 50 basis points in the first quarter to 9.3% due for the most part to seven blocks of space greater than 100,000 square feet that were put on the market in the first quarter. The addition of those large blocks of space across Midtown caused a negative 425,776 square feet of office absorption during that period. This was the first time since 2012 that Midtown generated negative first quarter absorption, C&W states.

The report, authored by Richard Persichetti, regional research director, tri-state and northeast for C&W, along with research director Lori Albert and research manager Lauren Hale, predicts that “with Midtown asking rents still off historical highs, expect increases throughout the year.”

Midtown South vacancy remained steady at 6.3%, only a 10-basis-point increase from year-end 2015. Absorption was a positive 252,275 square feet, and new leasing activity increased 24.6% year-over-year with 1.4 million square feet of leases signed. The technology, advertising, media, and information services (TAMI) sector was responsible for 72% of all new leases signed during the first quarter.

The Downtown office market, like last year, had an influx of space placed on the market during the first quarter. The 613,350 square feet of space that was added at 375 Pearl St. contributed to a large portion of the negative 632,269 square feet of absorption. Although vacancy jumped 80 basis points to 10.2% in the first quarter, over the last two years Downtown vacancy has dropped at least 100 basis points throughout the last three quarters of each year.

Class A asking rents dipped $1.04-per-square-foot in the first quarter to $62.13. The TAMI sector accounted for 58% of new leasing activity during the first quarter.

“With overall asking rents at $59.28-per-square-foot, Downtown will likely recover all of the space that was added to the market to start 2016, given that overall asking rents still range from $9.00 to $19.00 lower than the other major Manhattan office markets, the report states.

NEW YORK CITY—With employment expected to remain robust and a significant uptick in large space users in the market at the moment, expectations are that leasing and office rents here will be higher this year.

Cushman & Wakefield, in its office market snapshot for the first quarter of this year reports that office leasing should rise in 2016 as there are more than 45 large space users currently searching for space in New York City at the moment.

Office vacancy increased 50 basis points the first three months of 2016 to 9.0%, due primarily to the addition of 613,350 square feet at 375 Pearl St. in the City Hall submarket and 367,585 square feet at 575 Fifth Ave. in the Grand Central submarket. Those large space additions contributed to the negative 805,770 square feet of office space absorption in the first quarter in Manhattan.

New leasing activity totaled 6.6 million square feet in the first quarter. Although this is a 6.0% decline from the first quarter of 2015, leasing activity was still higher than the first quarter historical average of 6.2 million square feet, C&W reports.

“The decline in year-over-year new leasing activity can be attributed to the decline in the number of large leases signed—only five new leases greater than 100,000 square feet were inked in 2016, compared to 10 leases one year ago,” the report states. Overall asking rents increased $0.82-per-square-foot during the first quarter to $72.40-per-square-foot.

A key indicator that the New York City economy remains strong is that the unemployment rate fell 90 basis points in the last 12 months, (to 5.4% as of February 2016).

In the past year, an additional 111,600 jobs were added to the city's public and private workforce, bringing total employment to more than 4.3 million jobs. Office-using employment increased by 2.9% during the year, led by professional services adding 27,000 jobs. In addition, the New York City population reached an all-time high with more than 8.5 million people and has grown by 375,000 residents in the last five years.

A key takeaway from the C&W snapshot report included the financial services industry being the key driver for office leasing in Midtown, accounting for more than one-third of all leasing activity in the first quarter in that district.

During the first three months of 2016, Midtown overall asking rents increased 2.3% to $78.42-per-square-foot, surpassing its 2.0% increase throughout all of 2015. Class A asking rents were 2.3% higher at the end of the first quarter to $83.54-per-square-foot. The Midtown vacancy rate increased 50 basis points in the first quarter to 9.3% due for the most part to seven blocks of space greater than 100,000 square feet that were put on the market in the first quarter. The addition of those large blocks of space across Midtown caused a negative 425,776 square feet of office absorption during that period. This was the first time since 2012 that Midtown generated negative first quarter absorption, C&W states.

The report, authored by Richard Persichetti, regional research director, tri-state and northeast for C&W, along with research director Lori Albert and research manager Lauren Hale, predicts that “with Midtown asking rents still off historical highs, expect increases throughout the year.”

Midtown South vacancy remained steady at 6.3%, only a 10-basis-point increase from year-end 2015. Absorption was a positive 252,275 square feet, and new leasing activity increased 24.6% year-over-year with 1.4 million square feet of leases signed. The technology, advertising, media, and information services (TAMI) sector was responsible for 72% of all new leases signed during the first quarter.

The Downtown office market, like last year, had an influx of space placed on the market during the first quarter. The 613,350 square feet of space that was added at 375 Pearl St. contributed to a large portion of the negative 632,269 square feet of absorption. Although vacancy jumped 80 basis points to 10.2% in the first quarter, over the last two years Downtown vacancy has dropped at least 100 basis points throughout the last three quarters of each year.

Class A asking rents dipped $1.04-per-square-foot in the first quarter to $62.13. The TAMI sector accounted for 58% of new leasing activity during the first quarter.

“With overall asking rents at $59.28-per-square-foot, Downtown will likely recover all of the space that was added to the market to start 2016, given that overall asking rents still range from $9.00 to $19.00 lower than the other major Manhattan office markets, the report states.