From the February issue: The high volume of leasing in recent months, fueled in part by tenants signing early renewals at sharply reduced prices, could come back to bite the market next year, some industry experts said. Tenants with two and three years remaining on their leases — and sometimes even four years — are signing renewals early, said Bruce Mosler, CEO and co-chairman of commercial services firm Cushman & Wakefield. “We are seeing, I think, a push to market … to take advantage of the capitulations in rents,” he said. “Which I think is creating demand in this market, and I think it will [reduce] demand in ’11 … unless we see some job growth again.” However, some brokers did not expect the same elevated levels this year. “I don’t think January will continue at the same level,” Howard Rosen, regional managing director at commercial firm Grubb & Ellis New York, said in an interview. “As far as I am concerned, the jury is out, and I don’t see job creation in Manhattan.” [more]

The leading source of the sublease space now flooding the city’s
commercial office market is Goldman Sachs, which has put 597,000 square
feet on the market at 77 Water Street. Barclays has put 456,842 square
feet on the market at 277 Park Avenue. All together, sublease space in
New York City has ballooned 139.2 percent since the second quarter of
2007 and now stands at 17.1 million square feet. At the height of the
last recession, between 2001 and 2004, sublease space never topped 14.4
million square feet. [more]

Source: Colliers ABR

While commercial leasing activity has picked up in the past few months,
according to Colliers ABR’s Manhattan May office report (see report on jump), the city’s
Class A vacancy rate increased and average rents fell last month. The vacancy rate of Class A space in Manhattan reached 11.9 percent in
May, up from 11.3 in April. Class B and Class C availability also
increased last month, pushing the overall Manhattan vacancy rate to
13.1 percent, its highest level since reaching the same rate in
December 1996. Meanwhile, the average asking rent for Class A space
fell to $65.43 per square foot in May, down 4.9 percent from $68.83 a
foot a month earlier. TRD [more]