The leasing outlook for retail and office assets in the Big Apple tells two different tales.

Retail availability in the city hit a record-low 13.9% in Q3 2024, down from nearly 28% just three years ago — with prime locations witnessing strong demand. On the other hand, while offices have seen an uptick in utilization over the past couple months, vacancy rates remain north of 20% citywide. Though this market is showing signs of improvement, many industry players are still approaching the market with cautious optimism.

Despite these different outlooks, both sectors share a common goal of aiming to provide an elevated experience for their tenants and customers.

“If you go back before Covid, amenities factored very little in the decision to lease a property,” said Barry Goldstein, CEO of Arch Amenities Group. “I would go as far as to say the spaces weren't even explored during a leasing event. Nowadays, we're seeing it become table stakes.”

Goldstein will be speaking at Bisnow’s New York City State of the Market event on Nov. 19. Click here to register.

Bisnow spoke with Goldstein to find out more about the current trends in New York City’s office and retail sectors, what challenges they are facing this year and the projects that Arch Amenities has worked on in the city.

Bisnow: What new trends have you noticed in New York City's commercial real estate market?

Goldstein: There’s a growing trend toward enhancing office buildings with amenities and hospitality services. We’re noticing a significant uptick in Midtown, especially as many companies relocate and consolidate in the area. In addition to traditional amenities like fitness centers, we’re increasingly seeing high-tech meeting spaces and wellness features being incorporated into these spaces.

There’s also a new focus on monetizing these areas, particularly through hosting meetings for both tenants and outside clients. Overall, offices are beginning to operate more like hotels in terms of their service approach and how they manage various situations.

Bisnow: At this event, you'll be speaking on the Emerging Tenant Trends in Office and Retail panel. What role do amenities play in the leasing decisions of tenants in both office and retail spaces?

Goldstein: Before the coronavirus pandemic, amenities rarely influenced leasing decisions, and they often weren't even considered during the process. Now, they’ve become a critical factor — it's fair to say they can even be a dealbreaker. Companies are more aware of the services available for their employees.

Having spent time at home and enjoying various local amenities, people now expect similar offerings in the office, even in a hybrid-work model. These amenities have become integral to the leasing decision, sometimes included in common area maintenance fees, while at other times they come with additional costs.

We’ve seen some buildings increase their leasing rates from 60% to nearly 100% simply due to the amenities provided. It's clear that without these features, or plans for them, potential tenants are exploring other options.

Bisnow: What are the challenges facing New York City's commercial real estate industry this year? How is the industry equipped to handle these challenges?

Goldstein: Identifying, constructing and outfitting these spaces with the right amenities is a challenge. Occupancy remains difficult, particularly in the Financial District of NYC.

Consumers prefer a one-stop experience, wanting to arrive at a hub where they can walk or take a short trip. This puts more pressure on the outskirts of the city. There’s a strong push to create mixed-use buildings, but the historical layouts of many structures complicate conversions. Transforming these buildings is challenging on its own, and they must also include the right amenities to draw in future tenants.

Bisnow: Can you discuss any projects that your team has recently completed in New York City?

Goldstein: One of the projects we take great pride in managing and operating is the Playground in the Seagram building. Collaborating with RFR, the building's owner, we activate the space through tournaments and events. The facility features a full climbing wall, basketball courts, a gym and pop-up pickleball courts.

Recently, we also began managing the Solow building at 9 W. 57th St., which offers a mix of food and beverage options, meeting spaces, hospitality services, an updated gym, recovery rooms and wellness facilities. These elements represent the ideal amenities that tenants desire in a building.

Additionally, we are involved in various other projects related to layout design, branding conceptualization and management. We partner with building owners and property managers from the outset to help them determine the most suitable amenities for their spaces

Bisnow: What do you think event attendees will be most excited to hear about at this event?

Goldstein: Audiences are always eager to learn about the latest trends that attract people to buildings. They’ll also be interested in hearing about our developments, especially regarding the integration of various services and amenities into property technology apps. Technology has become essential for many prospective tenants and building managers. We’ve created a platform that prioritizes services tailored to a building's demographics and psychographics, ensuring we meet the needs that make the most sense for each property.

This article was produced in collaboration between Arch Amenities and Studio B. Bisnow news staff was not involved in the production of this content.

Studio B is Bisnow’s in-house content and design studio. To learn more about how Studio B can help your team, reach out to studio@bisnow.com.