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June 29, 2006
Demand for Midtown Office Space Pushes Prices Up
The NY Times
By Terry Pristin
The market for Class A office space in Midtown is so hot that The Times found an example where a landlord paid its tenant to move in order to lease out the space for more than double the previous rent.
While the vacancy rate in Midtown over all is said to be about 8 percent, space is even tighter in the so-called Plaza submarket, from the Avenue of the Americas to the East River and 51st Street to 63rd Street.
NoLandGrab: Bruce Ratner is watching market trends for Class A office space very carefully, as Forest City Ratner is currently trying to fill its share of the Times Tower with tenants.
How does this affect Atlantic Yards? Continued demand for Class A office space could lead Ratner to convert some space in the proposed skyscrapers back to office/commercial space, as originally planned. However, the movement to diversify back-office operations of large corporations, post-9/11, has run its course, and the demand for Class A space in the outer boroughs hasn't materialized, as evidenced by the failure of the Downtown Brooklyn Plan to build anything but luxury housing.
Posted by lumi at June 29, 2006 7:07 AM