Manhattan office leasing extended a decline in the first quarter, falling to the lowest level in a year and a half, as rising rents and a lack of affordable options caused some tenants to hold back on new agreements.
Deals were signed for about 6.8 million square feet (632,000 square meters), down from 12 million square feet a year earlier and a record 12.7 million square feet at the end of 2013, according to brokerage Savills Studley Inc. Another real estate firm, Colliers International, showed a 30 percent year-over-year slump in leasing.
The slowdown reflects a decline in lower Manhattan, where record rents may have priced out many of the growing technology and media companies that had led demand. The area is also home to new towers such as 1 World Trade Center, which have added to supply and command higher rates than more affordable space that has already been taken...Manhattan Office Leasing Declines as Tenants Priced Out
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National Office Sector Report (Q4 2014)