Midtown office leasing, which has taken the brunt of the current economic downturn, will see a flurry of expiring leases in 2010, which will help reverse the dearth of activity, a new report from commercial brokerage CB Richard Ellis says.
Midtown will see a large increase in leasing activity in 2010 when 1,380 leases totaling 20.3 million square feet expire, the report shows.
The Midtown office market, with 34 million square feet available for leasing, has seen an average price cut of 16 percent for 16 million square feet of that space since September 2008, the firm said.
CBRE said the repricing of space, to reflect the actual market value for available space in Midtown, should be completed by the year’s end, while leasing velocity has stabilized at a level that is about half its five-year average.
“We are now in an environment where leasing deals can be made in Midtown, as landlord and tenant expectations are more closely aligned, evidenced by the narrowing gap between asking and taking rents,” said Pamela Murphy, senior vice president for CBRE’s New York tri-state market data services. TRD