By David Greene: Overall, Murray Hill Properties sees a NYC market that is tightening and we expect it to continue

At the time of this writing, we see financial markets around the world fluctuating from day to day and there is concern about the world economy. Will there be a double dip recession in America? Can Portugal, Italy, Ireland, Greece and Spain pay their debts? Will this eventually set off an inflationary spiral? When times get tough, practical people often move towards quality investments like bonds and treasuries and hard assets such as commercial real estate. In this new paradigm, can there be a better opportunity to take a long hard look at commercial real estate investment? Manhattan is a place unto itself. A small island occupied by just under 2 million residents with almost 50 million tourists coming through our great city every year. The island is filled with office buildings, residential apartments and homes, open park space, numerous tourist attractions and a fairly inexpensive public transportation system. Here in Manhattan we have one of the largest populations and we are also one of the world's safest large cities. From the Yankees, to Broadway shows, to the fantastic museums and galleries, to some of the best food in the world, to an economic juggernaut in the financial sector; it is no wonder that NYC is a top destination for most people and often considered the center of the world. Yet, somehow, none of this translates to expensive office rents as we see in Tokyo or London or Paris or even in major cities in India. Even the most recent national jobs report can't put a dent in New York City as the report indicated a net zero gain in jobs across America yet New York City has seen an increase of 76,000 jobs since September 2009. With that in mind though, the Manhattan office leasing market continues to get tighter. As vacancy rates are going down, rental rates are moving up and landlord concessions are receding. This is no longer news. Now, in certain markets in Manhattan, we are seeing multiple offers on space. A good example would be the Flatiron district. If you have an office tenant, who is looking for 2,000 s/f to 10,000 s/f and they need a 5th Ave. address and want to be located between 14th St. and 23rd St., according to our industry standard database, there are exactly 10 spaces available. The same can be said about the now trendy Park Ave. South market. If you have a 2,000 s/f to 10,000 s/f office tenant seeking space between 16th St. and 23rd St., there are exactly 10 spaces that are now available. Yes, there are some sections of the city where the market is a bit hesitant but in most locations the market continues to get a bit stronger. So what does this all mean? Except for the World Trade Center projects downtown and the Gem Tower in midtown, there is no new office building product coming online for a few years. Supply and demand dictates that prices will continue to rise. A lease is a financing document and with rents moving up, commercial office building prices are rising as well. As for tenants, with prices rising, vacancy rates receding and landlord incentives diminishing, it is likely they will be paying higher rents and tenants will begin to expand the parameters of their search to include new neighborhoods. Overall, we here at Murray Hill Properties see a market that is tightening and we expect it to continue in this direction for some time. David Greene is the president of MHP Commercial Brokerage Services, New York, N.Y.