CBRE Group issues November 2013 Manhattan Office Marketview Snapshot

Manhattan logged 2.67 million s/f of leasing activity in October, outpacing the previous month's 2.34 million s/f of activity by 14%, and October 2012's 2.27 million s/f of leasing by 18%. Year-to-date leasing crossed the 20 million mark, ending October at 20.71 million s/f By comparison, Manhattan logged 19.06 million s/f of leasing through the first 10 months of 2012. Manhattan experienced a moderate 60,000 s/f of negative absorption in October. The overall availability rate, at 12.3%, was unchanged from the previous month. The Manhattan-wide average asking rent rose $0.43 during October to $62.27 per s/f Year-over-year, the average was up 9%, or $4.95 per s/f Among the report's highlights: * Midtown - October's 1.94 million s/f of leasing activity outpaced the market's five-year monthly average of 1.2 million s/f by 62%. Year-to-date leasing reached 12.94 million s/f in the month, surpassing 2012's full-year tally of 12.84 million s/f Midtown's average asking rent rose $1.02, or 1%, during October to $71.21 per s/f The month's increase was attributed to the addition of several blocks of high-priced space to the market as well as the above-average pricing of space that had been listed without a published asking rent. * Midtown South - The market's 350,000 s/f of leasing activity in October was 3% above the market's five-year monthly average of 340,000 s/f year-to-date leasing totaled 3.41 million s/f, 23% short of the robust 4.45 million s/f of activity recorded during the same 10-month period in 2012. Midtown South had 90,000 s/f of negative absorption in October as the month's leasing activity was offset by several new availabilities, including 132,000 s/f of direct space at 212 Fifth Ave. and 81,000 s/f of sublease space at 450 West 15th St. The overall availability rate edged up 10 basis points during October to 10%, while the sublease availability rate remained at 2.0% for the third straight month. The average asking rent rose $0.21 during October to another record-high $64.42 per s/f On an annual basis, the average was up 22%, or $11.72 per s/f * Downtown - Posted its fourth consecutive month of above-average leasing, with October's 370,000 s/f of activity topping the market's five-year monthly average of 350,000 s/f by 5%. Downtown's 4.36 million s/f of year-to-date leasing paced 15% ahead of the 3.8 million s/f of activity logged during the same period in 2012. New availabilities placed on the market during October counterbalanced the month's leasing activity, resulting in a modest 30,000 s/f of negative absorption and a 10-basis-point increase in the overall availability rate to 14.6%. The average asking rent was virtually unchanged in October, rising $0.02 month-over-month to $46.98 per s/f * Capital Markets Activity - A joint venture between The Carlyle Group, Ashkenazy Acquisitions and Century Plaza sold 650 Madison Ave. to a joint venture between Vornado Realty Trust, Highgate Holdings, Crown Acquisitions, Oxford Properties Group and JP Morgan Asset Management for $1.3 billion ($2,157 per s/f). A joint venture between Ivanhoe Cambridge and Callahan Capital Partners bought a 51% interest in 1211 Ave. of the Americas from a joint venture between Beacon Capital Partners and Lehman Brothers Holdings for $854.8 million ($438 per s/f). A joint venture between RXR and Walton St. Capital purchased 237 Park Ave. from Lehman Brothers Holdings for $825. million ($699 per s/f). Vornado Realty Trust purchased a 92.5% partial interest in 655 Fifth Ave. from the joint venture of Meadow Partners, CPP Investment Board and LoanCore Capital Partners for $277.5 million. General Growth Properties purchased 200 Lafayette St. for $150 million ($1,240 per s/f) from a joint venture between CIM Group and Kushner Companies. 503 Broadway was purchased by Inditex Group from the Fung Family for $250.0 million ($2,000 per s/f).