Manhattan Office Market Holding Steady So Far in 2017
Manhattan's office market had a strikingly similar first half of 2017 to how it performed a year earlier, despite a down second half of 2016, according to a new report from Colliers International.
Across the borough, there has been 17.8M SF of leasing activity, just about in line with the first six months of 2016 and 22% better than the 10-year historical average. The market's strength is largely driven by its employment numbers, with 83,000 new jobs added from May 2016 to May 2017, a 2.2% increase that beats both national and New York state averages over the same time period.
Average asking rents in Manhattan also held flat at $73/SF, within 0.2% of both the first and last six months of 2016. Availability in the borough was also within 0.2% of both previous six-month periods.
The biggest lease in the past six months in Manhattan was BlackRock's planned move to 847K SF at 50 Hudson Yards in Midtown South from Park Avenue, while the biggest non-financial office transaction was News Corp.'s renewal and expansion at 1211 Sixth Ave.
In Midtown, availability is at its highest point in the last three years at 10.8%, although it is just a marginal increase over the second half of last year. Seven different blocks of over 100K SF became available in Midtown, including the Park Avenue space BlackRock is vacating.
Although leasing activity remained flat in Midtown South, to the dismay of those watching the delivery of new supply, the Downtown market saw a large recovery from the down second half of 2016, nearly doubling that period's leasing activity. Downtown's average asking rent improved to $63 per SF, compared to $59 per SF in the second half of 2016 and $58 in the first half.