This WSJ article talks about Manhattan rent going down.  

I remember when I moved to Silicon Valley in June 2000, just before the 1st dot-com bust, rent was horribly high, and availability was even worse.  I remember seeing a "For Rent" sign up for 6-hours raising 40 applicants.  I remember getting an apartment because I ended up on an accelerated list because my income was over 3X the rent.   

During the following years of recession, I saw rent drop by 50% easily with empty apartments.  This was due to the bad economy resulting in a mass exodus of people.    

The big difference was that during that era, we still had the beginning of the housing boom, so people weren't losing their homes (aka converting into renters).  

Now you would think with today's situation, with foreclosures being nearly at an all time high, there would be more folks converting to renters, and hence driving UP rental prices even though there is an exodus with job losses.  

I guess there are lots of folks leaving Manhattan.