Manhattan office towers are once again reaching for stratospheric prices, Crain’s reported. Two office buildings — Worldwide Plaza and 11 Madison Avenue — have hit the block in the last week asking figures around $1.5 billion, underscoring the demand for trophy properties in Manhattan.
The average price for a Manhattan office building hit $661 a square foot in the first half of 2012, up 33 percent year-over-year, according to figures from commercial brokerage Cushman & Wakefield, Crain’s noted.
But office rents have shown little promise of late.
Low borrowing rates and a lack of appealing investments elsewhere, however, are propelling prices for office towers up, Crain’s said. The two $1.5 billion price tags represent a test of the market, executives told the magazine.
“People want to see if a building with a billion-dollar price tag will move,” Nat Rockett, an executive vice president at Cushman & Wakefield, told Crain’s. “If the answer is yes, you will start to see more come to the market.” [Crain’s] — Guelda Voien