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Midtown market tightening.

Vacancy for Midtown Class A space shows tightening while the rest of the New York City market lags behind, according to third quarter market statistics issued by CB Commercial Real Estate Group, the nation's leading commercial real estate services firm.

"Tenants looking for large blocks of class A space in Midtown should be in the marketplace now," said Steven A. Swerdlow, esecutive vice president and managing officer of CB Commercial in New York City. "In terms of rents, today's levels are the bottom for class A space."

Several large lease transactions including Columbia House, Price Waterhouse and Saks Fifth Avenue have helped to tighten supply and slice the vacancy rate by almost a full percentage point in Midtown.

"Tenants are upgrading to higher quality, better located, class A buildings, capitalizing on the current market," said Swerdlow. "Tenants will continue to focus on prime Midtown buildings held by strong owners which should build strength in the Midtown market."

The vacancy rate dropped .86 percentage points since the end of second quarter to 14.35 percent. "Midtown will lead any New York City market recovery," says Swerdlow. "The growth in positive absorption should be seen as an indic tion of market recovery.n

There will be an increase in marketable class A space as certain West Side

buildings regain stable ownership.

Rents remain low, dropping three percent from $34.90/square foot at the end of second quarter to $34.00/square foot today. Additionally, tenants are still getting substantial free rent and work letters, reports Swerdlow.

Downtown vacancies have worsened, rising to 21.86 percent from 20.32 percent second quarter.

Rents actually rose two percent to $25.51 since second quarter and absorption continued to be negative.
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Title Annotation:vacancy rate decreasing in Class A commercial space in Midtown Manhattan, New York, New York
Publication:Real Estate Weekly
Date:Nov 4, 1992
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