The outlook for office space vacancy rate in the Manhattan office space market is not pretty for Landlords. Vacancy rates are predicted to increase from around 5% a year ago to between 11% and 17%, depending on where you get your numbers. Third quarter results show that Manhattan office vacancy the highest in over 2 years at around 7.5%. I can't imagine that this will come as a surprise to anyone in the industry.  The October Financial Crisis resulted in the loss of thousands of jobs in Manhattan. New York state is predicting that 160,000 state residents could loose their jobs because of the economic downturn.  The New York City Comptroller predicts that up to 165,000 people could loose their jobs in NYC over the next two years. At 200 square feet per person, that is around 33 million square feet that could go empty. Put that together with a bleak outlook for our economy and the result will be an increase in office space vacancy. It is expected to happen quickly. Many pundits predict that we will have vacancy rates in Manhattan between 9% and 10% by the end of the year.

It is bad news for Landlords, but also presents many great opportunities for Tenants in the market. Tenants will have much greater negotiating power. Some Manhattan Landlords are even offering up to one year of free rent on 10 year leases. Sublease space available for lease has nearly doubled from 3.5 million square feet a year ago to 6.5 million square fee now. Rental rates in Manhattan are still some of the highest in the world averaging around $73.00 / sf / year. It is expected they will to decline in the neighborhood of 15% to 20% over the next year as the full extent of the vacancy rate climb is realized and as company trim their staffs to survive a bleak economy.

If you are in the market now, plan to be in the next 12 months, or have a renewal coming up within the next 2 years, it is a great time to start looking at your options.  The best way to do that is to make sure and work with a professional tenant rep.  There is very rarely any cost to you to obtain their services. Landlords are in the business of renting space. You run your business and are likely only lease space a few times in your business career. Level the playing field with a professional who is on your side and in the office leasing business on a daily basis.

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A while back I did a presentation at the Office Business Center Association's annual conference on the future of office space. I thought it would be a good time to revisit parts of it since it does have options and opportunity in today's turbulent market place. The question of where is office space headed during the 21st Century is the million dollar question if you want to stay competitive in the office rental market! Having a clear understanding of the factors that are affecting change in the office market will help us all make better business decisions about how to position ourselves for success over the next 15 - 20 years. It also may give you some ideas on alternatives you could benefit from immediately.

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As vacant land disappears and real estate prices soar there is a movement to make changes in the height limits to allow developers to build taller buildings.  The current law limits building heights to the width of the adjacent street plus 20 feet. There have been several exceptions to allow for construction of the National Cathedral and Georgetown University Hospital. Otherwise, the Height Act has capped most buildings at 130 feet, though heights of 160 feet are permitted on certain areas of Pennsylvania Avenue. (Contrary to popular lore, the city's low-lying skyline has nothing to do with preserving the prominence of the 555-foot Washington Monument's.)

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We queried our network of over 700 local member agents who specialize in office properties to come up with a list of suggestions that may be useful to office tenants. We only chose the most frequent comments and those that we thought would be most useful.

While it might sound a bit self serving, the one suggestion that came forward most frequently was work with an office tenant representative with whom you can consult on action available to your specific situation. It usually won’t cost you anything to have them take a look at your situation to determine what course of action would be best for you to take. In other words, you have nothing to lose and everything to gain.

It may be helpful to consider all of your options. We'll show you what they are. There are quite a few depending on your needs, budget and wants.

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Welcome to the new blog presented by OfficeFinder.

Here you will find all sorts of great information related to office space rental, commercial office space, leasing information, etc.

To find out how much space you need, be sure to check out our Office Space Calculator.

Have a great day!

The OfficeFinder Dev Team