Manhattan office space vacancies increase as rents decrease, Colliers determines

By Adam Pincus | November 11, 2008 02:49PM

Asking rents in Class A office buildings in Manhattan declined while vacancies rose to their highest level since March 2006, according to Colliers ABR.

Rents were down 5.6 percent to $83.38 from the May 2008 high of $88.37, the data showed. Total vacancies were up 29 percent from the start of the year to 8 percent, or 18.4 million square feet. The last time so much space was available was March 2006 when vacancies hit 18.2 million square feet, the new Colliers data indicates.

Some of the increasing inventory can be attributed to the impending moves by Goldman Sachs to it new headquarters at 200 West Street in Battery Park City and Bank of America to its new home at One Bryant Park, Robert Sammons, managing director of research at Colliers ABR, said at a briefing today.

Sublet space has grown more rapidly, increasing 123 percent since January to 6.8 million square feet, the company reported.

Although the sublet increase was substantial, the total amount did not approach the 11 million square feet recorded for March 2003.

“Sublets are nowhere near as high as they were around 2000 and 2001 after the new media, dot-com implosion. But they are climbing, and climbing fairly rapidly,” Sammons said.