8 Major Slices Of Manhattan’s Office Space Hitting The Market Next Year
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Last year, the New York City office market reached new heights, even in the midst of vast amounts of supply hitting the market. As large tenants flock to new construction, they are leaving behind significant footprints.
There are at least 10 blocks of space bigger than 100K SF in Manhattan with leases due to expire through the end of 2020, according to Transwestern data supplied to Bisnow.
“If you look at what happened in Q1, about 14 blocks over 100K SF were added … 7M SF was leased and availability only went up 10 basis points,” Transwestern Research Manager Danny Mangru said, pointing to big leases already signed this year such as First Republic at 460 West 34th St. and The Spiral. “I still think we will have a healthy year of leasing.”
Here's a look at some of the big space that will be opening up soon:
151 West 42nd St.
Owner: The Durst Organization
Space available: 660K SF
Law firm Skadden Arps announced in 2015 it would be vacating 151 West 42nd St., previously known as 4 Times Square, for Brookfield's One Manhattan West development near Hudson Yards, leaving a 660K SF space behind it.
Durst has since found a tenant for some of the space, with Bank of Montreal leasing a 215K SF chunk in the building earlier this month. Nasdaq is also in the process of moving from the Financial District to 141K SF at 151 West 42nd St.
The bulk of that lease is going into former Condé Nast space — the hole from the publisher's departure to One World Trade Center has yet to be fully filled — but BOM will be taking 48K SF of Skadden’s space next year, according to Durst.
Condé Nast's lease expires at the end of the month, and 88% of its former space is now leased, according to Durst. The former Skadden space is now 40% leased.
The landlord also scored a $900M refinancing for the building this month, with JPMorgan Chase and Wells Fargo providing the debt. That money is expected to finance Durst's continued efforts to lease the remaining vacancy at the Midtown skyscraper.
850 Third Ave.
Owner: Jacob Chetrit and sons
Space available: 263K SF
Jacob Chetrit and his sons, Michael and Simon, bought this building earlier this year from China’s HNA Group for $422M. According to Transwestern, a total of 263K SF in leases will expire in June next year. Discovery Communications, now merged with Scripps Networks, is consolidating its space at 230 Park Ave. South — which means Discovery is leaving some 160K SF at 850 Third Ave. behind.
“Our experience in the New York City office market has enabled us to make wise investments in this competitive marketplace," Michael Chetrit said to Bisnow in a statement at the time of sale. "We view 850 Third Ave. as a balanced investment, due to its existing strong tenant roster and the opportunity for future upside."
55 Water St.
Owner: Retirement Systems of Alabama
Space available: 275K SF
Some 275K SF will be vacant in April of next year at the 3.6M SF 55 Water St., according to Transwestern. EmblemHealth is negotiating to reduce its lease there, Crain’s New York Business reports, which means a floor is now available.
Justworks is looking at leasing 275K SF there, Crain’s reports, including EmblemHealth's leftover space, as the HR software company plans to move from the Starrett-Lehigh Building in Chelsea and expand beyond its current footprint. 55 Water, as the building with the most office square footage in New York City (right now), will still have more availability even if Justworks finalizes its deal.
825 Third Ave.
Owner: The Durst Organization
Space available: 500K SF
Durst had been shopping the ground lease on this building, but pulled it from the market last April.
Advance Publications’ lease is expiring at the Midtown skyscraper, leaving behind 500K SF — essentially the full building. Durst developed the 40-story tower back in 1969, and with it now vacant, Durst plans to embark on a repositioning, including a new lobby and new mechanical systems, Commercial Observer reported.
Space available: 255K SF
As of November next year, 255K SF worth of leases will be expiring at 200 Liberty St, according to Transwestern. The building, which is part of the Brookfield Place complex, is occupied by the Associated Press, law firm Cadwalader and insurer XL Catlin, among other tenants.
Brookfield is planning on spending tens of millions of dollars updating 200 Liberty's lobby, the New York Post reported last year. Despite the building currently being nearly full, upcoming expirations will allow Brookfield to bring 400K SF in availability to the leasing market at rents around $70/SF, according to the Post.
220 West 42nd St.
Owner: EPIC Real Estate
Space available: 220K SF
Known as Candler Tower, this building was built between 1912 and 1914 by Coca-Cola magnate Asa Griggs Candler. It is now owned by Steven Elghanayan’s EPIC Real Estate, which bought it in 2012 from Paramount Group and scored $150M to refinance the building in 2017, per The Real Deal.
The building is leased until 2020 to Live Nation, and the lower floors are subleased to McDonald’s, and 220K SF in leases will run out next year.
EPIC plans to renovate the retail component and expand it by at least two floors or an attempt to attract a “high-end” tenant, according to the company website. Then, EPIC plans to renovate the upper floors and continue to use it as office space or turn it into a hotel.
Owners: Normandy Real Estate Partners and Columbia Property Trust
Space available: 160K SF
Columbia Property Trust and Normandy Real Estate Partners’ plans for a new boutique office building will add a 160K SF block on the office leasing market, per Transwestern, the largest available big block of space in new construction slated to open next year.
The building — for which the companies scored a $187M construction loan from Apollo Commercial Real Estate Finance — spans a total of 182K SF, according to CXP. Rents there are some of the highest in the city, between $140 and $160 per SF, according to The Real Deal.
330 West 42nd St.
Owner: Deco Associates
Space available: 670K SF
In one of the biggest leases inked last year, 1199 SEIU United Healthcare Workers East took 520K SF at George Comfort & Sons' 498 Seventh Ave. in a 30-year lease. That meant a subsidiary of the union will be leaving Deco Tower Associates’ 330 West 42nd St., with its lease for around 520K SF expiring in October next year.
However, the plan for the building — where some 670K SF would now be available, according to Transwestern — may no be longer office. The owners are planning to convert the landmarked space into a residential building, The Real Deal reported last year.
UPDATED, APRIL 25, 9:30 P.M. ET: This story has been updated to reflect leases at 151 West 42nd St., and its new name.