With leasing slowdown, space comes back on market

The Manhattan office market showed some signs of a slowdown in the fourth quarter of 2007, as a streak of four straight quarters of positive absorption ended with 758,554 square feet of space going back on the market, according to a just released market report by leasing agent Newmark Knight Frank.
 
The amount of space leased in the fourth quarter of 2007 was 35 percent lower than the amount of space leased in the fourth quarter of 2006, the report said.
 
Average asking rents fell by 45 cents to $61.46 per square foot in the fourth quarter, down from $61.91 per square foot in the third quarter.
 
Downtown was the healthiest submarket in the fourth quarter, with the availability rate falling 60 basis points from the third quarter to 8.6 percent.

Downtown’s average asking rent was $46.33 per square foot, the report said.
Within the Downtown submarket, rents in the World Trade Center/World Financial Center district were the highest, averaging about $70 per square foot, compared to $53.69 per square foot in the fourth quarter of 2006.
 
The overall availability rate in Manhattan increased slightly to 8.3 percent in the fourth quarter, from 8.1 percent in the previous quarter; 6.7 percent of this space represented offices available for direct leasing, while 1.6 percent of it was available space to sublet.
 
As of January, there was 8.33 million square feet of office space under construction in Manhattan, the report said.

The city’s unemployment rate increased to 5.2 percent in December 2007 from 4 percent in December 2006, according to the household survey of employment. TRD