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In an early sign that Manhattan's commercial leasing market may be on the verge of a turnaround, financial institutions are signing deals for office space, inquiring about space to rent and pulling their excess square footage off the sublet market.
In recent weeks, investment firm Houlihan Lokey Howard & Zukin, the Bank of Bermuda and Citigroup all signed deals for larger midtown offices. Lehman Brothers, Morgan Stanley and Toronto Dominion are evaluating their midtown office needs, according to local brokers, and UBS has decided to hold on to the space it's tried to rent out for two years.
"Many of these financial services groups are re-examining their offerings," says Jim Saunders, a Newmark & Co. Real Estate Inc. senior managing director. "It's one indication that the market is healthy again."
But some experts say that it may take more than early inquiries and midsized leasing deals to kick start Manhattan's commercial leasing market. Some of the active banks are simply shuffling space and taking advantage of the rental market before prices rise. While increased hiring is spurring the recent moves, these skeptics argue that only the creation of more jobs will energize Manhattan's commercial...