Tag Archives: asking rents

U.S. office sector posts lowest vacancy rate of the recovery

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JLL has released its Q3 2014 United States Office Outlook

Q3USreport_blogOverall, the outlook for the U.S. economy is positive, with businesses continuing to invest more in people and products. Economic momentum is picking up, and tenants are continuing to expand.

On the investment sales side, activity is up 38 percent year-to-date, and investment profiles diversified. Most of the large deal flow was heavily concentrated in… Read More

New York office market posts lowest overall vacancy rate since Q3 2008

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  • Vacancy rates down in all submarkets, building classes
  • Overall Manhattan rents continue to rise in 3rd quarter of 2014

NYC_blogDespite moderate leasing activity during the third quarter of 2014, New York’s office market posted sharp drops in vacancy rates in every submarket and property type, according to JLL. The city’s overall vacancy rate has fallen to its lowest level since the third quarter of 2008.

Manhattan’s overall vacancy rate dropped to 9.7 percent this quarter, a decrease of 8.5 percent (or 0.9 percentage points) from 10.6 percent at midyear 2014. The city’s Class A vacancy rate fell to 10.6 percent in the third quarter of 2014, a decrease of 7.8 percent (or 0.9 percentage points) from 11.5 percent the previous quarter.

“The final quarter of the year is typically the most active in Manhattan, and brokers reported brisk building touring activity over the summer,” said Tristan Ashby, director of New York research.

“Going forward, we expect to see much higher rents throughout the city as vacancy rates continue to tighten. There are increasingly fewer opportunities at the very top end (Plaza Trophy) and very low end (Downtown Class B) of the market, or anywhere in Midtown South. Longer-term, large blocks will begin entering the market in Midtown beginning in 2018 as new construction, redevelopments and several large blocks vacated by relocating tenants come online.”

Overall average asking rents in New York rose to $64.91 per square foot this quarter, an increase of less than one percent from $64.57 per square foot at midyear 2014. The city’s Class A average asking rent grew to $71.66 per square foot in the third quarter of 2014, an increase of less than one percent from $71.28 per square foot the previous quarter.

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