New York Market Overview
- Total Manhattan Class A Office vacancies decreased from 9.4 % vacant to 9.1 % vacant
- Total New York City Office vacancy decreased from 8.4 % vacant to 8.2 % vacant
Manhattan’s average asking office rent rose slightly year-over-year to $73.07. The Lower Manhattan office market saw asking rents grow year-over-year during the first half by almost 9% to $63.46 per square foot.
June was a solid month for Manhattan office leasing. The 10 biggest office lease deals totaled 938,748 square feet, up over 300,000 square feet from May. Office rental prices increased in seven of Manhattan’s 18 submarkets during the first half of this year.
Midtown office leasing was up nearly 12% from where it was at the halfway point of 2016. There have been 10 new leases or renewals of that size, compared to five at the halfway point last year.
Midtown asking rents dropped 2% to $83.09 per square foot. Midtown South held relatively steady at $66.32 per square foot.
Tech tenants accounted for just 13% of new leases in Midtown South during the first half of 2017, down from 35% the same time last year. TAMI tenants are increasingly heading Downtown.
New York Retail:Retail vacancy rates rose 10% in both Manhattan and Brooklyn during the second quarter of 2017, to 3.8 and 2.9%, respectively.
Manhattan’s high-end retail market has been struggling with rising vacancies. Six of Manhattan’s twelve top retail markets have availability rates of 20% or more.
The average asking rent for Midtown South retail, which includes Koreatown’s Fifth Avenue corridor, fell 18% year-over-year this spring.
New York Sales:Office sales prices in Manhattan crossed the $1,000 per square foot benchmark for the first time in four quarters.
Sales prices for New York City development sites are down 22% through the first half of 2017. In 2016, transactions averaged $404 per buildable square foot, but that average is down to $314 through June of this year. The Bronx has posted the cheapest closings of any borough, with sales averaging $64 per square foot.
Manhattan’s investment-sales market tumbled 60% year-over-year during the second quarter to $13.8 billion. There were 66 deals recorded at a price of $10 million or more, compared to 71 deals for all four quarters ending in July.