Wednesday, December 24, 2008

Manhattan Office Vacancy Rate Rises to 10.9%

The overall Manhattan vacancy rate rose to 10.9 percent in the fourth quarter, the highest level in two years and more than three percentage points greater than a year ago, according to the report released by FirstService Williams.

Space available directly from a landlord registered an 8.1 percent vacancy rate in the fourth quarter, while sublease space weighed in at 2.8 percent -- the highest rate in more than three years.

Financial services companies and Wall Street related law firms are at the core of the climbing vacancy rate.

Financial services firms, including Citigroup Inc., Credit Suisse Group AG, Credit Lyonnais, Alliance Bernstein, UBS AG, MetLife Inc, Bear Stearns, and National Financial Partners Cor, placed almost 1.2 million square feet of sublease space on the market in the fourth quarter.

Legal services firms such as Reed Elsevier; Cadwalader, Wickersham & Taft; and Thacher, Proffitt & Wood contributed 230,000 square feet of sublease space. Other law firms, including Orrick, Herrington & Sutcliffe and Thelen Reid Brown vacated almost 450,000 square feet of direct space.

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