Manhattan office leasing ‘up 34 percent’

[Published July 2011 and updated June 2023] New research has found that office leasing in Manhattan has risen significantly recently, despite the slowness of the US economy’s rebound.

Leasing rates in Manhattan have risen a full 34 per cent since last year a new report from CB Richard Ellis has found. This has driven down the availability rate of office space in the area.

The report noted that so far this year 15.7 million square feet of office space had been leased. This is four million more than was rented by this time last year.

“Despite a lagging national economy, New York has managed to outpace the nation and its global urban competitor cities with a better employment picture and renewed confidence that high-quality new-building owners will find the tenants they need,” said Matt Van Buren, Executive Managing Director at CBRE.

“The market is in a strong and sustained positive trend.”

Average rent rose by 9.1 per cent on last year. It now stands at USD 51.93 per square foot.

The rebound in the fortunes of the city’s financial services industry has played a major part in the resurgence of the office market in New York. Activity by large media companies has also helped.

Several major deals, which went through in the first half of this year, resulted in lowered availability.

For example, media giant Conde Nast signed a deal to move from its headquarters in Times Square to 1 World Trade Center.

Also, Morrison Foerster is to lease 180,000 square feet of office space at 250 West 55^th St.

“You’re seeing New York as a place where almost every company is saying we have to be in, and a market we can’t avoid. If we want to recruit the best and the brightest, those people are in New York,” Peter Turchin, CB Richard Ellis’s Executive Vice President, was quoted in the NY Post as saying.

Editor’s notes: In the first quarter of 2023, vacancy rates in Downtown Manhattan stood at 22.6 per cent and in Midtown Manhattan they stood at 21.2 per cent.

The average vacancy rate across all NYC submarkets was 16.1 per cent.

4.6 million square feet of office space was let during the first quarter which was a decrease on the previous quarter and the least amount of activity since Q2 2021.

The total inventory of office stock in NYC in Q1 2023 was 469,575,735 square feet and the vacancy rate meant that 75,784,609 square feet was not yet leased. At that time, there was 13,628,890 square feet of new space under construction.

The average office rent in NYC was $82.50 per square foot per year.

As of June 2023, Morrison Foerster still listed 250 West 55th Street as its New York office on its corporate website.