Midtown Class A vacancy drops to lowest rate since early 2009
The vacancy rate for Midtown Class A office space fell last month to its lowest level since the first quarter of 2009, according to a monthly report released today by commercial real estate firm Jones Lang LaSalle.
“With the increase in activity and no notable blocks of space placed on the market, vacancy dropped below 14.5 percent for the first time since the end of the first quarter 2009,” the report, covering January leasing in Manhattan office buildings, said.
The Midtown Class A vacancy rate was 14.3 percent in January, down from 14.7 percent in December, the report says (see the full report below).
At the same time, asking rents for Class A space in Midtown were essentially flat, down four cents to $65.15 per square foot. For all classes of Midtown buildings, the vacancy rate fell by .5 points to 13.8 percent and the average asking rent slipped by five cents per foot to $59.43 per square foot, the report says.
For Manhattan overall, the vacancy rate fell by .3 points to 12.8 percent, and the average asking rent fell by 26 cents per foot to $53.33 per square foot.
In the Downtown market, the vacancy rate rose by .2 points to 11.1 percent, and the average asking rent fell by 56 cents per foot to $37.28 per square foot; while in Midtown South, the vacancy rate was unchanged at 11.2 percent and the average asking rent rose by 56 cents per foot to $43.76 per square foot, the figures show.
The CEO of Jones Lang LaSalle, Colin Dyer, speaking about global real estate values on CNBC from Davos, Switzerland, said capital markets could recover quickly, but fundamentals remain weak (see video).
Because of soft employment levels, global occupancy rates and rents remain depressed.
“Rental levels will stay low for some time to come,” he said.