Office rents in Manhattan climbed for the first time in over 24 months during the fourth quarter of 2010, according to Cushman and Wakefield.
The brokerage added that the rental growth, the first since the third quarter of 2008, was a result of landlords taking advantage of a surge in demand for space.
Joseph Harbert, Cushman's chief operating officer, told Bloomberg that the rental rise was one of a number of signs of recovery in the city's property market. Indeed, in the fourth-quarter, office leasing totalled 7.5 million square feet as renters looked to make deals before prices climbed.
"We see that continuing, the number of deals that we thought were going to close in December that didn't close was enormous. And a lot of these were large tenants. We expect that velocity in the first quarter is going to be probably about the same rate," he added.
The news comes in the wake of a recent report from Jones Lang LaSalle which predicted that investment in European commercial property will rise by as much as 35 per cent this year.