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Leasing up sharply in 1st half of '92.

Could this be the light at the end of the tunnel?

Commercial leasing activity in Manhattan's Midtown, Midtown South and Downtown regions rose sharply during the first half of 1992.

Particularly strong in activity was Midtown, where 7.4 million square feet of space was leased since the beginning of the year, representing a 47 percent increase over the previous six months, and a 51 percent increase over activity charted during the same period in 1991. Moreover, availabilities in this region dropped from 33.8 million square feet at year-end to a current 32.5 million square feet.

So reports Stephen B. Siegel, president of the Edward S. Gordon Company, Inc., in the firm's mid-year analysis of the Manhattan space market.

According to Siegel: "The mid-year outlook is certainly bright, thanks primarily to the rapid pace of leasing, activity in Midtown Manhattan. Following suit are the Downtown and Midtown South regions, which have also witnessed a strong first half-year, fueled largely by movement among small space users."

In Midtown, several large leases helped precipitate the upswing, which caused availabilities to drop to 17.2 percent. Largest among these was News America, which leased 230,000 square feet of space at 1211 Avenue of the Americas; Coudert Brothers, which leased 156,500 square feet at 1114 Avenue of the Americas; Bank of Tokyo,, which took 152,000 square feet at 1251 Avenue of the Americas; Billboard Publishing, which signed for 121,400 square feet of space at 1515 Broadway; and CIT, which leased 112,500 square feet of space at 1211 Avenue of the Americas.

In the "alternative" markets of Midtown South, leasing, activity over the first half of the year, totalling 813,000 square feet, jumped some 65 percent over activity charted over the previous six months. While fueled primarily by small leases, the market did attract Scholastic Inc., which leased 168,000 square feet at 555 Broadway, and MacMillan/McGraw Hill School Publishing which leased 84,266 square feet at 10 Union Square East.

Diluting, the bright outlook is the availability rate, which rose to 18.2 percent, up 1.5 percent from the year-end rate of 16.7 percent.

Lagging, behind Midtown's brisk leasing clip, but witnessing, growth nonetheless, Downtown Manhattan experienced a 38 percent increase in leasing activity over the two previous six month periods. Bolstering activity were sizable commitments from the Economic Development Corp., which leased 110,000 square feet at 110 William Street, and the Securities and Exchange Commission, which leased 100,000 square feet at 7 World Trade Center.

Availabilities rose along with leasing activity, however, due primarily to four large blocks of space, totalling 1.8 million square feet, that were added to the market from One New York Plaza, One Liberty Plaza, Two World Financial Center and 60 Broad Street.
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Title Annotation:report from Edward S. Gordon Company Inc. on commercial leasing activity in New York, New York
Publication:Real Estate Weekly
Date:Jul 22, 1992
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