Subleases Are Driving Availability In The Long Island Office Market
Without any new construction, only company moves and consolidations are creating office space in Long Island.
No new office spaces delivered or are under construction, according to JLL's third-quarter report on Long Island office, but large blocks of space opened up in Jericho and Melville in Nassau County, accounting for nearly all negative absorption in the third quarter.
In moving its headquarters from Bethpage to Long Island City in Queens, Altice vacated 310K SF at 200 Jericho Quadrangle and 85K SF at 6 Corporate Center Drive in Melville, which doubled the vacancy rate for subleases in the county to 2.1%. Capital One consolidated to 1307 Walt Whitman Road in Melville, opening up 131K SF in 265 Broadhollow Road, also in Melville.
Overall, vacancy remains below 10% in Nassau County, though the most notable leases in the quarter were financial tenants taking less than 20K SF. According to JLL, landlord confidence remains strong in rental rates despite the lack of big leases, counting on the scarcity of large blocks of Class-A space to keep prices up. With the new openings and more projected to come in the next few quarters, that confidence could be tested.