The Manhattan Office Market Surges In Supply, Leasing Activity And Rents

Bolstered by a 211k SF C.V. Starr & Co 399 Park Ave renewal/expansion, Bloomberg’s expansion at 919 Third Ave and the City of New York’s 200k SF lease at 375 Pearl St, the Manhattan market saw 2.93M SF leased in July, a 22.8% month-over-month and 22.6% year-over-year increase in leasing activity.

That according to Colliers' New York July Monthly Market Report released this week, detailing the changes in average asking rents, availability rates and leasing activity for the Manhattan office market.

Midtown experienced the biggest jump in activity, up 41.9% from June 2016 and 26.8% from July 2015. Downtown experienced a 21% drop in activity, although it’s still up 33% from last year.

Photo Courtesy of Colliers International

With new Midtown and Midtown South inventory, availability rate remained steady at 9.9%, while absorption became negative, at 0.26 MSF.

Despite the drop in leasing activity, Downtown had no new inventory above 26k SF, and thus had positive absorption (0.35M SF) and a drop in availability, to 11.9%.

Downtown also had the biggest month-to-month increase in asking rents—a 1.1% increase to $58.89/SF—as cheaper space (like 375 Pearl St) was leased up. And with new inventory marketed at above average rates—such as the Time Warner Cable 75k SF block of One Columbus Circle being offered at $150/SF—average asking rents in Manhattan  increased 1.1% to $73.72/SF.

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