Midtown South Class A vacancy tightens to lowest level since 2007

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Manhattan Office Outlook | November 2014

MMU_Nov2014JLL’s New York Research team has just released its November Manhattan Office Outlook – a monthly wrap-up of leasing activity in Manhattan, including Class A vacancy and asking rates, along with a snapshot of conditions in capital markets.

Report highlights are as follows:

Midtown Manhattan
Midtown asking rents were mostly unchanged in October while vacancy dipped slightly. Class A vacancy decreased to 10.9 percent from 11.0 percent in September as no sizeable blocks were added to the market and activity was driven primarily by renewals.

Downtown Manhattan
Seven consecutive months of Class A vacancy decreases reversed course in the Downtown market in October due to the introduction of three large blocks of available space. Locations formerly leased by Fitch and Ambac Financial Group at 1 State Street and Goldman Sachs at 1 Liberty Plaza were brought to the market, adding a total of 558,042 square feet of vacant space to the supply.

Midtown South Manhattan
The Midtown South Class A vacancy rate continued to decrease in October, tightening to 3.7 percent—the lowest level since 2007. Overall vacancy, however, increased slightly to 6.9 percent from 6.7 percent. After record activity in the spring and summer, no leases greater than 100,000 square feet were signed in October.

Capital Markets
The New York City investment sales market saw 328 deals close through the third quarter of 2014, up 47.0 percent from full-year 2013 and on pace to surpass the previous record of 346 deals in 2007. Total deal volume topped $30 billion in closed transactions, with an additional $10 billion of deals under contract and anticipated to close by year-end.

Read the full report for more in-depth information about activity in the Manhattan office market.

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