Vacancy rates continue to decline, combined with strong demand, limited new construction and millions of square feet of commercial space converted to residential uses; the market will likely continue to tighten. According to the National Association of Purchasing Managers the New York economy is at the strongest level since October 2000.

Given the above, asking rental prices should continue to rise and Landlord incentives to Tenants for work and free rent should shrink. There are still a number of large planned relocations out of Manhattan from insurance companies and Wall Street institutions that are imminent but, given the broad demand this will only dampen the pressure to raise prices. Landlords are also feeling more confident as the stock market rebounds and corporate profits rise. Landlords are testing the market to see how much they can raise prices.

The Building Sales Market remains hot as limited product is coming to the market, interest rates are low and investors are flush with cash to invest. Further the demand for residential cooperatives and condominiums remains strong so commercial buildings are being valued not only for commercial use but for residential conversion as well.

Buildings being demolished:
130 Liberty Street a 1,415,086 square foot building is finally going to be demolished after having been partially destroyed in the World Trade Center collapse and the land sold to the Lower Manhattan Development Corp.

Building Sales:
67 Wall Street a 300,000 square foot building was sold for about $51 million or about $170/square foot.

Downtown Leases:
41 Broad Street Claremont Preparatory School, a for profit private school, has leased the entire 100,000 square foot building creating space for 1,000 students in grades Kindergarten through 8th grades.