Lower Manhattan Office Market Leasing Activity Spikes in September

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CBRE is reporting this week that Manhattan's office leasing activity totaled 2.26 million square feet in September 2015, 2% above its five-year monthly average of 2.20 million sq. ft. The availability rate decreased 30 basis points (bps) over the past month and 60 bps from one year ago Year-to-date net absorption remains negative, but improved by 813,000 sq. ft. in September. The average asking rent increased by $0.46 over the past month and is up 6% from the same period last year. Sublease availability is 1.7%, its lowest level since the beginning of 2008.
 
Manhattan office market highlights include:

Midtown - September leasing activity totaled 1.24 million sq. ft., 7% below its five-year monthly average of 1.33 million sq. ft. Year-to-date leasing activity totaled 13.66 million sq. ft., up 8% compared to the same period last year. The availability rate decreased 20 basis points (bps) over the past month and is down 60 bps from one year ago. Year-to-date net absorption remains negative, but improved by 323,000 sq. ft. in September. The average asking rent decreased by $0.82 over the past month and is up 4% from September 2014. Sublease availability stands at 1.8%, with an average asking rent of $63.37, up 9% year-over-year.

Midtown South - Leasing activity totaled 547,000 sq. ft. in September, 24% above its five-year monthly average of 440,000 sq. ft. Year-to-date leasing activity totaled 4.52 million sq. ft., down 12% compared to the same period last year. The availability rate decreased 30 basis points (bps) over the past month and is down 150 bps from one year ago. Year-to-date net absorption remains positive, and improved by 150,000 sq. ft. in September. The average asking rent decreased by $0.98 over the past month, but is up 6% from September 2014. Sublease availability is 1.6%, with an average asking rent of $54.97, up 2% year-over-year.

Downtown - Leasing activity totaled 473,000 sq. ft. in September, 7% above its five-year monthly average of 444,000 sq. ft. Year-to-date leasing activity totaled 3.39 million sq. ft., down 34% compared to the same period last year. The availability rate decreased 40 basis points (bps) over the past month and is up 20 bps from one year ago. Year-to-date net absorption remains negative, but improved by 340,000 sq. ft. in September. The average asking rent increased by $0.35 over the past month and is up 12% from September 2014. Sublease availability stands at 1.4%, with an average asking rent of $45.03, up 18% year-over-year.