NEW YORK CITY-The rebound of the office leasing market inManhattan continues apace, with vacancy rates declining and May’s2.6-million-square-foot tally providing the strongest one-monthtotal for new activity since September 2006, according to Cushman& Wakefield. Yet anecdotal reports of a few landlordsincreasing their rents aren’t borne out by the numbers, whichcontinue to show monthly declines.

“While there is some talk of select rent increases, averageMidtown class A asking rents fell 22 cents per square foot to$64.18 from April,” says a report from Bank of America MerrillLynch. “Rents are now down 35% from the May 2008 peak.” CassidyTurley makes a similar observation in its report for May, notingthat class A rents across Manhattan dipped 59 cents from April to$58.72 per square foot, with overall pricing also recording aslight drop to $48.42 per square foot from April’s average of$48.82 per foot.

Although asking rents have leveled off each month thus far in2010, vacancy rates have also begun to decline. Cassidy Turleyreported a 30-basis point drop in the class A vacancy rate fromApril’s 12.5%. C&W reported an even steeper decrease of 50basis points to 12%, representing the largest one-month percentagepoint decline since January 2007.