Manhattan’s once resilient commercial real estate market is showing signs of weakening even as it is about to be flooded with millions of square feet of available office space as a result of Wall Street’s shakeout.

Overall, the takeover of Merrill Lynch by Bank of America, the liquidation of Lehman Brothers Holdings Inc., and the uncertain future of insurance giant American International Group could throw into play about 10 million square feet of office space. That figure would be equivalent to 2.2% of the total 450 million square feet of Manhattan office space.

“It is not the end of the world, but it is certainly not good news,” the CEO of Newmark Real Estate, Barry Gosin, said. “This has got to have a diminishing effect on values and rent.”

Some brokers and analysts interviewed for this article predicted that rents for office space would be driven down, possibly by as much 15%, over the next 12 months. Others noted how the consolidation of the financial sector over the past several years, coupled with the demise of institutions such as Bear Stearns, Lehman Brothers, and Merrill Lynch, has the potential to unleash huge amounts of office space into the market in abbreviated periods of time.

“The fact of the matter is we are going to see more supply than we had anticipated as we go into a period of slackening demand. We certainly have entered a cyclical trough here in New York City,” the chairman of the real estate brokerage firm GVA Williams, Michael Cohen, said.

According to research provided by several brokers, American International Group currently holds leases on about 3 million square feet of office space in Manhattan, the bulk of which is at 70 Pine St. and 80 Maiden Lane. The firm has been battered by a downturn in the credit and mortgage markets, which have led to losses of about $40 billion.

Merrill has about 4.2 million square feet at the World Financial Center but occupies only about 2.6 million feet of it. Yesterday, Bank of America executives said they aim to cut $7 billion in costs from Merrill, likely in part from layoffs and a reduction in space.

It is the liquidation of Lehman and the effect its 3.4 million square feet of office space will have on the market that has city leaders most concerned.

Speaking at a press conference yesterday, Mayor Bloomberg said: “Problems will be exacerbated if Lehman vacates a lot of commercial space in this city.”

Lehman owns its 1 million-square-foot building at 745 Seventh Ave. In the event of a sale, the building could generate broad interest and a sale price of between $800 million and $1 billion, according to a number of brokers.

The firm has an additional 2.4 million square feet in leases and subleases around Manhattan, and an abrupt abandonment of its building and leases could increase the city’s vacancy rate to 9.5% in the first quarter of next year, according to a report issued yesterday by Jones Lang LaSalle.

The vacancy rate for Class A Midtown buildings could increase to 12%, according to the report. Manhattan’s vacancy was at 8.3% in the second quarter of this year and reached a high of 9.2% in fourth quarter of 2004. New York’s vacancy rate has been well below the average of other major American cities.

The president of the Real Estate Board of New York, Steven Spinola, said he was confident the market was equipped to deal with such a surge of available office space.

“I don’t believe there is any reason to see this as a major disaster for the commercial real estate market. We have not overbuilt in recent years and so there was not a lot of space available beforehand,” he said.