Vacancy rates for office space in Downtown Manhattan jumped to a six-year high as the market continues to struggle with oversupply and businesses migrating to Midtown. The jump in vacancy rates had an inverse affect on rents as asking rents fell below $40/sq ft to just over $39.
Manhattan’s office market posted mixed signals in Q3. Vacancy rates edged up 0.1 percent to 10.9 percent but leasing activity was up more than 60 percent compared to 2009. Asking rents fell another 1 percent to $53.80 but rents in Midtown managed to post a small increase.
Manhattan continues to be a tale of two cities with Downtown and Midtown on different tracks in terms of their recovery but each market carries some important next steps for businesses leasing space in Manhattan or considering opening an office there. If you’re looking for space in Midtown, its a good idea to contact a tenant rep right now in order to lock in low rates. If you’re looking for space Downtown, now is a good time to look at some of the bargains that are available in the area.