Manhattan investment sales have dropped to their lowest levels in more than a year. In January, $1.35 billion in property—hotels, office and apartment buildings, industrial and retail space—traded in Manhattan, according to research firm Real Capital Analytics; that’s the lowest monthly total since December 2006, and one of the lowest in the past three years. (The statistics include deals of at least $5 million.)

The conventional wisdom has since last summer held that Manhattan real estate in all its markets—home sales, office leasing, investment sales, apartment rentals and more—would dip from often record highs and stay down. But it is the investment-sales market’s drop that symbolizes the change in Manhattan’s real estate fortune more than any other.

Investment sales involve the billion-dollar office tower deals like the possible General Motors Building sale by noted debtor Harry Macklowe, which could garner $3 billion; or the truly historic portfolio trades, like the $5.4 billion acquisition in late 2006 by Tishman Speyer and partners of the Stuyvesant Town and Cooper Village apartment complexes. The big names come out to play in the investment-sales market, with big numbers (including big debt) and big results in the hemisphere’s biggest market.

So when that Masters of the Universe market quiets after such economic symphony—well, it’s time to stop blathering about a downturn and to start analyzing its duration.

Office-building trades drove investment sales to a record annual high of $54 billion-plus in 2007. But that same sector precipitated the dip in the market’s performance. In February of 2007, over $10.29 billion in Manhattan office space traded; in January of 2008, barely $612 million did, less than one-sixteenth of the monthly total 11 months earlier.

No Manhattan office address has sold for over $1 billion since December. In that month, landlord giant SL Green and a Canadian partner closed on the $1.575 billion purchase of 388-390 Greenwich Street; and developer Larry Silverstein, along with the California teachers’ pension fund, closed on 1177 Avenue of the Americas for over $1 billion.

The ripple effects of the subprime mortgage crisis that started to spread last summer have spurred such a phlegmatic pace. The conventional wisdom was proven spot on. Money is costlier to borrow; and lenders are wary. The general economic malaise blanketing the U.S. (and now, increasingly, parts of Western Europe, which provided Manhattan some of its more voracious investors of late) can’t possibly help the situation.

The low January investment-sales total and the low preliminary February total—$519 million—were to be expected, in spirit if not exactitude. The January 2007 total was $6.78 billion, over five times that of the same month a year later; and every month after except February 2007 failed to exceed it.