Downtown Manhattan Office Vacancy Rate Hits a Six-Year High as Firms Move

Downtown Manhattan’s office vacancy rate jumped in the third quarter to the highest level since 2004 as new space came on the market from financial companies, according to brokerage Cushman & Wakefield Inc.

The vacancy rate climbed to 12.1 percent from 9.9 percent a year earlier, Cushman, the biggest closely held commercial property broker, said today in a statement. It was also 9.9 percent in the second quarter. Rents declined to $39.08 a square foot from $42.01 in the third quarter of 2009.

The increased vacancies followed the addition of space at 85 Broad St., 1 New York Plaza and 70 Pine St., Cushman said. Goldman Sachs Group Inc. had offices at 85 Broad and 1 New York Plaza before moving into a new headquarters at 200 West St. The 70 Pine St. tower was formerly home to insurer American International Group Inc., which sold it last year.

The rate increase “is reflecting the three additions,” Joseph Harbert, Cushman’s chief operating officer for the New York region, said at a press briefing. The vacancy increase is resulting in “some really good values downtown,” he said. (more)