And so it grows–the Midtown South Class B average asking rent that is.
That figure closed July at $47.14 per square foot, up a dramatic 2.7 percent in the month alone, and the highest since December 2008, when it was $47.31 per square foot. With the Class A segment of this area presenting limited inventory (20.5 million square feet), it was thought a good idea to take a look at what was happening in the much larger Class B segment (51.3 million square feet).
The popularity of the Midtown South market among technology and media firms is now well documented. But this is not its first time at the rodeo (so the saying goes–Google it if you haven’t heard that one before).
In fact, the asking rent has been higher–hitting a record $51.65 per square foot in April 2008, just a few months after the official start of the recession.
Soon after the failure of Lehman Brothers, however, it plunged to $39.04 per square foot. The market does continue to tighten with a current vacancy rate of 8.7 percent–about half of what it was just after the end of the recession. And if technology and media continue to expand (and the shine on this area doesn’t wear off) then it is likely that the record asking rent from April 2008 will be broken … and soon.
Robert Sammons, Cassidy Turley