From the December issue: As 2011 draws to a close, real estate executives and brokers say it’s now clear that office tenants made faster leasing decisions this year than last. The coming off the fence was driven, professionals say, by the realization that the economy was not likely to experience any major changes — for better or worse — anytime soon.

Peter Braus, managing principal at commercial firm Lee & Associates, which last month announced an affiliation with Midtown-based Sierra Realty, said the mood in 2011 was a recognition that the economy was not going to turn around right away.

“[This year] has been more of a realization that the recessionary economy is here to stay — at least for the foreseeable future,” he said. [more]

Edward Minskoff and a rendering of 51 Astor Place

Edward Minskoff’s Minskoff Equities has closed on a construction loan valued at between $165 and $200 million with Bank of America for 51 Astor Place, the real estate company’s new office development near Cooper Union, the New York Observer reported.

Minskoff is confident in the success of the 400,000-square-foot property, which is slated to be completed by 2013, he said, despite not having signed any tenants so far.

“It will surpass the Bank of America building [at One Bryant Park] in some ways,” he said. To some brokers, rents at 51 Astor Place, which will range from about $88 to $115 per square foot, the Observer said, seem a little high. [more]

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From the October issue: Three years ago, with the country in the midst of a financial crisis, major global banks looked to cut costs by subletting their unneeded office space to other companies. Just weeks after Lehman Brothers Holdings filed for bankruptcy, financial institutions like MetLife, Citigroup and Bank of America dumped more than 1 million square feet of this so-called sublease space on the market. As the downturn dragged into 2009, the total amount of sublease space peaked, with Manhattan financial services firms listing at least 4.4 million square feet by the middle of the year. Today, news of Wall Street’s financial losses has pushed banks to take out the knife once again, looking for ways to cut back on expenses. And some real estate insiders expect those boardroom decisions to lead to another increase in sublease space in the Manhattan market. [more]

As the vacancy rate for Manhattan Class A office space continues to drop, landlords are trying to see how far they can push up asking rents, according to Crain’s. They are holding back on their most sought-after properties in order to achieve higher rents.

According to recent data from Cassidy Turley, the Class A vacancy rate dropped to 10.8 percent for June, down a full percentage point from the same period last year. Yet, the number of buildings with zero vacancies dropped — from 48 to 42. Only 23 Midtown office buildings are now fully occupied, Crain’s said.
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Nearly a month after Condé Nast formally agreed to lease about 1 million square feet in 1 World Trade Center, brokerage firms are mulling over what impact the publisher’s move from Midtown will have on the Downtown market.

One commercial brokerage firm, Cassidy Turley, is taking a close look at which companies have a tight relationship with the media giant to see if they might transfer their offices to Lower Manhattan to remain close by, and hire Cassidy Turley to assist them.

The impact from Condé Nast’s move downtown “can’t be overestimated,” Robert Sammons, Cassidy Turley’s vice president of research, said. Comments

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Midtown’s smaller and older Class B buildings have vacancy rates rising and asking rents
declining, bucking the overall positive trend in Manhattan’s largest market, a monthly
report from commercial services firm Cassidy Turley shows.

“I would say that a concern today is the Class B market in Midtown as it is lagging in the
recovery,” said Robert Sammons, vice president of research at Cassidy Turley.

The 70 million square feet of Class B office space in Midtown had a vacancy rate of 15.3
percent in April, up from 14.2 percent in April one year ago. [more]

Source: Cassidy Turley

The Manhattan office vacancy rate ticked up in the first quarter of 2011 even as employment in the professional sector rose at the fastest clip since 2000, Robert Sammons, vice president of research for commercial real estate services firm Cassidy Turley, said.

Companies in the city brought on 11,500 new office workers in the first three months of this year, the most in any first quarter since 2000, when 15,700 jobs were created, he said.

The first-quarter vacancy rate rose even as employment moved up because of several factors, including large blocks of space being added to the market from tenants who signed relocation deals last year, and because many firms have excess space for their new hires, according to Sammons. He said he did not believe the rate rose because of any further erosion in the market. Comments

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New York City’s office subleasing marketing is drying up, and landlords are readying for rent hikes in its wake, Crain’s reported. Data from Cassidy Turley shows that in November, the amount of available New York sublease space — usually 30 to 40 percent cheaper than space available for direct leasing — hit 10.9 million square feet. That’s the city’s lowest level since October 2008, when the market crashed and subleases began flooding the market as tenants with pricey Park Avenue office space snapped into consolidation mode. Comments

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When the office leasing market began to collapse more than two years ago, Midtown
Class A landlords fearful of putting out the wrong price in the volatile market pulled back
from listing their asking rents. Now with the leasing market returning to approximately normal volumes spurred by
sharply reduced prices, more Class A property owners in Midtown are confident enough
to list their asking rents, Robert Sammons, vice president for research at commercial
services firm Cassidy Turley, said. The firm’s December office report released Monday shows why they are getting more
self-assured. The vacancy rate for Midtown Class A space fell to 10.9 percent in
December, down from 13.9 percent one year earlier, and asking rents were $65.29 per
square foot, up from a recent low of $63.87 per foot in September. (See the full report
after the jump.) [more]

The office leasing market in Manhattan was mixed last month with a decline in overall vacancy rates that pointed to an improvement but at the same time average asking rents continued to slide lower revealing continued weakness, a new report rele [more]