Manhattan office rents fell by a record 7.4% in the second quarter as landlords adjusted to job losses and fallout from the shrinking financial services industry, property broker Cushman & Wakefield Inc said.
Rents declined to $60.23 a square foot from $65.01 in the first quarter, New York-based Cushman said in a report today. The vacancy rate rose to 10.5 percent, up from 7.1% a year earlier. Vacancies may rise to 14.3% by mid-2010, the highest since 1996, Cushman said.
Demand for office space fell as the city lost 108,000 jobs since August 2008, according to figures from city Comptroller William Thompson. More than 11 million square feet of space was available for sublease in the second quarter as financial firms sought to shed offices they no longer needed.