NEW YORK CITY—Cushman & Wakefield onTuesday released its thirdquarter office report for Manhattan, which indicated that in thefirst nine months of this year the borough has generated 24.4million square feet of leasing activity.

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Officials with the brokerage firm say that Manhattan's officeleasing market is on pace to surpass 2011 levels and thereforebecome the busiest market in more than a decade. Another positivefor the market was that September 's 2.9 million square feet ofleasing activity was the 13th consecutive month that leasing inManhattan scored at least 2 million square feet or higher. Thestreak is now the longest period on record, according to C&W.Strong employment, the brokerage firm states in its report, hasfueled 5.3 million square feet of positive space absorption throughthree quarters in Manhattan.

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The technology, advertising, media and information (TAMI) sectorwas a key driver in the third quarter, particularly in deals ofmore than 100,000 square feet. There were a total of 36transactions in excess of 100,000 square feet completed inManhattan through the third quarter, including new leases, renewalsand renewal expansions. Of those transactions, 14 were completed bythe TAMI sector. An additional seven of those transactions werecompleted by the financial services sector. In total, 27 of the 36transactions were new leases.

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“The TAMI sector is leading the leasing velocity this year andwe're seeing growth in this sector continuing, with companiestaking space not only in Midtown South, but in Midtown andDowntown,” says Ron Lo Russo, president, NYTri-State region for C&W. Commenting on the large dealsnegotiated in the third quarter, LoRusso says, “These large dealsare mainly new leases, which shows companies willingness to moveand their confidence in the market and local economy.”

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The overall average asking rent in Manhattan increased 6.6%year-over-year to $66.62 per square foot. The Manhattan class-Aoverall asking rent increased to $73.29 per square foot from $68.40per square foot a year ago.

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The Downtown market saw the largest year-over-year drop invacancy of the three major Manhattan submarkets. The current 9.0%vacancy rate decreased 1.8% year-over-year. The overall averageasking rent increased 5.3% to $48.43 per square foot.

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The Midtown Manhattan market saw the largest year-over-yearincrease in the average rental rate, the C&W report states. Bythe close of the third quarter, the average asking rent totaled$73.72 per square foot, up 7.8% year-over-year.

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The Midtown South market continues to lead the nation as thetightest Central Business District with a vacancy rate of 8.5%. SanFrancisco is close behind with a vacancy rate of 8.6%. MidtownSouth has led the country with the lowest vacancy rate since thefourth quarter of 2007.

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John Jordan

John Jordan is a veteran journalist with 36 years of print and digital media experience.