Midtown office leasing highest in four years

December 09, 2010 06:14PM

Office tenants in Midtown leased more space in November than in any month since the middle of 2006 as new office leasing rang in at double the monthly average, a new report covering all firms’ deals released today by commercial firm CB Richard Ellis shows.

“The month’s robust leasing activity — the largest single-month total since June 2006 — was achieved by deals of all sizes across the entire market,” the Midtown report says.

Tenants struck relocation or expansion deals for more than 2.4 million square feet in Midtown, compared with 1.2 million square feet the month before. Large deals such as French bank Societe Generale taking 444,072 square feet at 245 Park Avenue and Meredith Corporation leasing 214,200 square feet at 805 Third Avenue, the report indicates.

The high leasing activity lifted the overall market which was also buoyed by a strong month in Midtown South. Downtown results were much weaker. This data is in line with a report released by Cassidy Turley yesterday, which indicated that Midtown South activity has been pushing office vacancy down.

For Manhattan overall, leasing activity was strong with 3 million square feet taken, driving down the availability rate by .4 points to 13 percent, CBRE figures show. The average asking rent in Manhattan overall was flat, however, rising just $0.06 per square foot to $47.81 per square foot.

In Midtown, the 2.4 million square feet of new leasing was twice the five-year-monthly average of 1.2 million square feet, and drove down the availability rate by .4 points to 12.6 percent. Despite the high activity, asking rents did not rise much, lifting just $0.03 per foot to $55.16 per square foot.

Midtown South also saw good leasing figures from November, with 410,000 square feet leased, about 46 percent above the five-year average. Tenants signed major leases in all sizes, from a 99,184-square-foot deal by Innovation Interactive at 32 Sixth Avenue to a 12,844-square-foot deal by FutureBrand at 233 Park Avenue South, the CBRE report shows. Average asking rents rose by $0.10 per foot to $43.46 per square foot. 

Downtown was the one weak market, where businesses leased just 190,000 square feet, about half the five year average, and average asking rents dropped by $0.08 per foot to $38.03 per foot. Despite the negative figures, the availability rate declined by .1 point to 14.3 percent.  TRD