market research

November 2007

November 2007 New York Commercial Real Estate Market Report

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New York Market Overview

  • Total Manhattan Class A Office vacancies increased from 5.4 % vacant to 5.6 % vacant
  • Total New York City Office vacancy increased from 5.3 % vacant to 5.6 % vacant
Manhattan office and rental rates have stalled, at an all time high, as vacancy rates start to increase modestly.

At the current office rental rates, corporations are exploring cheaper alternatives in Brooklyn, Queens and New Jersey. For instance, Colgate Palmolive and Goldman Sachs are pursuing this strategy as are numerous other corporations and businesses.

7 Subway Extension.
Approval for digging tunnels to extend the No. 7 train has been approved by the MTA, a $1.14 billion contract.

Building Sales.
Last month, Commercial sales fell 67 % over the same period a year ago.

Following Archstone-Smith's recent closing on the acquisition by Tishman and Lehman, insiders see other REITs as potential future targets.

Penn Station.
Penn Station may get a makeover, called the Moynihan Project. It would include 7 million square feet of new development, including two new skyscrapers on either side of One Penn Plaza and up to 1 million square feet of retail space. Surrounding blocks will be designated for manufacturing and will be rezoned for commercial and residential development.

Affordable Housing.
A total of 949 rental apartments will built or restored, including 828 units that will be affordable to low-income families in Manhattan, Brooklyn and the Bronx this year.

Merrill Lynch Headquarters.
Merrill Lynch
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