Rents Signal Rise of D.C., Fall of N.Y.
January 8, 2010
By: Christina S.N. Lewis

The office market in Washington, D.C., is poised to topple New York as the nation's most expensive, reflecting the declining fortunes of the nation's financial center and the government expansion under way in the U.S. capital.

Rents declined in almost all of the 79 American cities tracked by Reis Inc., a New York based-research firm, in the fourth quarter of 2009. The largest fall was in New York, where average effective rents -- or the net amount tenants pay after landlord concessions -- fell nearly 20% to $44.69 per square foot annually. It was the sharpest decline in rents ever recorded by Reis since it began compiling data in 1981. ...

... By contrast, it's been a brutal year for New York landlords. "Rents have fallen faster and more furiously than in any other time in the last 30 years," said Mitchell Steir, chairman and chief executive of Studley, the tenant-brokerage firm. ...

... New York's vacancy rate was 11.5% in the fourth quarter of 2009, the second lowest rate in the nation, according to Reis's survey. Washington had the lowest at 10.7% compared with 17% nationally. ...

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