Grubb & Ellis Report Shows Uptick in Class A Leasing Makes Dent in Availability

My firm, Grubb & Ellis New York, has just released its February Monthly Market Trends Report. But don't let the name fool you - the report actually reviews activity from the month of January.

I am preparing a full posting on it for next week, with an in-depth focus on Midtown South, but I wanted to pass along the highlights of the report for everyone today:

• Availability for all of Manhattan dipped 10 basis points to 14.5%
• Class A available supply decreased (by a net 850,000 RSF) for the first time in a year, but continued to rise in Class B and C buildings
• Early lease renewals are an emerging trend amongst tenants, as is overall lease renewal activity, which accounted for 40 percent of the square feet leased in 2009
• Class A net effective rents are down 48% from the market peak, which will likely translate into a push by tenants now in Class B buildings to seek an upgrade to Class A space

The year began with three noteworthy lease renewals totaling over 900,000 RSF:

• State of New York - 480,708 RSF at 60 Broad Street
• City of New York - 315,751 RSF at 60 Broad Street
• Citadel Investment Group - 105,000 RSF at 153 East 53rd Street