New York City office
and retail Market Research

January 2017

January 2017 New York Commercial Real Estate Market Report

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Manhattan Office:
Manhattan office market slowed as Tenants await new fiscal policies from President Trump. Millions of square feet are coming on the market which will push prices down in older office stock.

Manhattan Retail:
Manhattan retail prices in non-prime areas are falling, as retailers ask if leases are economical and there is more online competition.

New York Market Overview

  • Total Manhattan Class A Office vacancies decreased from 9.2 % vacant to 9.1 % vacant
  • Total New York City Office vacancy stayed at 8.3 % vacant

Manhattan office

Manhattan Office leasing was down 4.2% in November and 16.2% year-over-year.
Office availability in Midtown South is up, with subleasing comprising 27% of availability.
Downtown leasing activity was slow as the market waits for big deals in the pipeline to close.

Manhattan Retail

Between fall 2015 and 2016, average asking rents fell in 11 of Manhattan’s 17 retail submarkets. The Flatiron District on Broadway between 14th and 23rd streets was hardest-hit, with asking rents down 23%. Herald Square as well as on Madison Avenue between 59th and 72nd streets saw asking rents drop 11%.
Uncertainty continues in the city’s retail market. Asking rents have dipped across large parts of Manhattan. Availability rates increased year-over-year in almost every retail submarket of the borough last quarter. Tenants are not signing up for pricey long-term leases, landlords have had to adjust and are more open to short-term leases.
Total Manhattan Class A Office vacancies decreased from 9.2 % vacant to 9.1 % vacant
The Financial District stood out as the past year’s outlier, with asking rents rising 20% as space in new developments in World Trade Center came online. Overall, tenants have been less willing to sign pricey leases, while landlords have been equally unrelenting when it comes to lowering their asking rents. The result is less leases being completed.
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