Manhattan Office Market: The Narrative Holds

In the Manhattan office market, the storyline since last summer has been one of decline measured by greater vacancy amounts and static rents. The narrative held coming out of this summer.

A new report from Colliers ABR shows a Manhattan office vacancy rate of 8.7 percent in August, essentially unchanged from July and 2 percentage points higher than in August 2007. The average asking rent was also basically the same in August as in July (and August 2007) at $65.89 a square foot.

There was no roaring out of the summertime into an especially active fall. Which isn't a surprise. The knell has sounded for quite some time about the office market's downturn, and the summer of '08 didn't silence it (see more on the summer's office stats here).

More stats from the Colliers report:

• Midtown's vacancy rate was 8.1 percent in August, down slightly from July and up from 6.3 percent a year ago.
• Asking rents for top, Class A Midtown towers averaged $96.10 a square foot in August, down slightly from July but nearly $2 above the August 2007 average.
• Midtown South's vacancy rate was nearly 10 percent in August, its highest in years, driven up by vacancies in Chelsea and the Flatiron.
• Downtown's vacancy rate was up to 8.8 percent in August from 8.6 percent in July.
• Downtown's vacancy rate for top office space was the highest since early 2007.
• The difference in average asking rents for top office space in Midtown vs. in Midtown South and Downtown was over $32 a square foot.