financial markets

As the industry knows, all brokerage firms gather their datadifferently, so statistics and findings will vary. CB RichardEllis' Q2 2008 report shows office rents rising slightly from Mayto June. Overall Manhattan asking rents rose from $71.35 per sf inJune from $71.25 in May, as availability rose to 9% from 8.9%, andabsorption improved to negative 0.25 million sf from negative 0.37million sf. June was a strong month for leasing activity,especially Downtown, with large leases such as American InternationalGroup's 803,000-sf lease at 180 Maiden Ln, amongothers.

According to Grubb & Ellis, the office market reached itspeak in the real estate cycle during the first quarter, asavailable supply continued to increase and demand for spaceremained sluggish. In the second quarter, the overall vacancy rateclimbed 70 basis points from the first quarter to 5.6%, the largestone-quarter vacancy increase since the fourth quarter of 2001. Thefirm says that negotiations are still in the landlords' favor, buttenants are beginning to gain some leverage when compared with thelast three years. "Concessions in Midtown have already increasedcompared to this time last year, with an average of an additional$3 per sf in work being offered and one to two additional freemonths of rent included in the lease," the report says.