market research

April 2019

April 2019 New York Commercial Real Estate Market Report

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Manhattan Office:

Manhattan office rents were up an average of $4/RSF in Midtown. Some of that increase is the result of new construction and more expensive office space being leased and inexpensive offices being torn down. There has been over 16 million square feet of office space either demolished or converted to alternate uses in the past 12 years.

Manhattan Retail:

There were more store closings announced than new openings. Tommy Hilfiger is the latest Fifth Avenue store to close. Payless also announced it is closing.

On a positive note: The Hudson Yards mall opened with a 1 million-square-foot complex that is about 85% occupied.

Manhattan Building Sales:

Manhattan investment sales reached over $3 billion in deals closed, up 12% more than the 12-month average, but down 30% from December’s peak.

New York Market Overview

  • Total Manhattan Class A Office vacancies increased from 9.9 % vacant to 10.2 % vacant
  • Total New York City Office vacancy stayed at 7.8 % vacant

Manhattan Office:

Midtown office leasing totaled 1.60 million square feet in January. The availability rate was 10.8% up slightly and average asking rent rose more than $4 to $82.45 per square foot.

Midtown South leasing totaled 550,000 square feet in January, 53% more than the same period last year. Availability rate rose to 10%, up slightly from December, with average asking rent to $82.25. Lower Manhattan office leasing totaled 910,000 square feet in January. Availability rate is 13.3%, and the average asking rent is $61.80 per square foot. Half of the leasing volume came from one deal, New York City Health & Hospitals signed a 24-year, 526,552-square foot lease at 100 Pearl Street.

Total Manhattan Class A Office vacancies increased from 9.9 % vacant to 10.2 % vacant

Manhattan Retail:

There were more store closings announced than new leases signed. Tommy Hilfiger, will close its 22,000-square-foot store at 681 Fifth Avenue. Payless is shutting down entirely and Gap and Victoria Secret are closing select locations.

On a positive note: The Hudson Yards mall opened with a 1 million-square-foot complex that is about 85% occupied.

Manhattan Building Sales:

Manhattan investment sales reached just over $3 billion in deals recorded, 12% above the 12-month average, but down 30% from December’s peak. The top sale was of the office building One Dag Hammarskjöld, which Rockpoint Group bought from the Ruben Companies for $566 million.

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