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Though the office buildings under construction in Hudson Yards have scored major wins in luring tenants, the multifamily buildings are experiencing the effects of New York's saturated new rental market.
Related Cos., Brookfield, Extell Development, Imperial Cos. and Lalezarian Development have all opened multifamily buildings in the new district on the west side of Manhattan, and all of them are offering concessions to lure tenants, Crain's New York Business reports.
Between all the new deliveries, more than 2,000 apartments have delivered in the past 18 months, meaning competition is fierce even without accounting for its top-of-the-market rents and the flat rental market across the city.
To get occupancy to levels needed for key refinancing deals down the line, Brookfield is offering two months of free rent on 14-month leases and three free months on 26-month leases at its The Eugene building in Manhattan West, which began leasing in March. That increased in July from initial concessions of one and two months on those respective lease periods. Brookfield has also waived some security deposits and reimbursed broker's fees, according to Crain's.
A representative for Brookfield told Crain's that market-rate units at The Eugene are 67% leased, ahead of schedule, and Related's One Hudson Yards is 60% leased without offering free rent — though it has lowered prices in some cases and offered discounts on amenity memberships.
Imperial's Henry Hall and buildings from Extell and Lalezarian have also combined free months of rent and other incentives to goose rental rates, in hopes of matching the success at One Hudson Yards and The Eugene and filling the Hudson Yards neighborhood with residents ahead of the major office deliveries in the coming years.
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