Drilling down into the numbers, the FSW report finds that theactual results for asking rents differed according to whether thespaced in question was direct or sublease—and further, whether thatspace was located in Midtown or Midtown South. Although askingrents slipped for direct space in Midtown, they rose for sublease.For Midtown South, it was just the opposite.

"These highlighted rent movements in the direct and subletcomponents from quarter to quarter are more the result of thequalities of the available spaces in each of the two timeperiodsthan any subtle shifting of market supply/demand dynamics," FSWchairman Robert Freedman says in the report. "The overridingconclusion is that the amount of available space contracted inthese two markets, and there is no significant amount of newconstruction that will be completed in either of these marketsduring the next two years, aside from the completion of 11 TimesSquare in early 2010." He adds that even assuming only moderateeconomic growth, "space availabilities will become tighter in 2011and 2012."

The report notes a "small but significant decline" of 2.6% inthe amount of sublease space across Manhattan during Q1. The sizeof the decline, though, resulted from what the report called"continued deterioration in the Downtown market," with a 32.7%increase in sublease space during the quarter. On their own,Midtown and Midtown South showed improvement.