market research

July 2016

July 2016 New York Commercial Real Estate Market Report

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New York City Office: Manhattan Office leasing continued to be quiet with the largest lease being a renewal for UBS.

New York City Retail: Retail leasing remains slow with new store closures so rents will likely decline over the next 6 to 12 months.

New York Market Overview

  • Total Manhattan Class A Office vacancies stayed at 8.9 % vacant
  • Total New York City Office vacancy decreased from 8.1 % vacant to 8.0 % vacant
Demand for Manhattan office space slowed with monthly leasing of 1.8 million square feet of new Manhattan office leases, the lowest level of monthly leasing in 2016. Year-over-year, leasing activity is down 13.5%. But overall vacancy declined to 9% in May, a reduction of 10 basis points, or 0.1% which was due to a noticeable reduction in the amount of new space added to the market. Despite a slowdown in leasing velocity, a minimal amount of new supply hit the market, allowing for the overall vacancy to drop in the Tri-State area. Overall, Manhattan average asking rents climbed to $72.81 per square foot last month, up 3.8% from $70.13 per square foot in May 2015. Midtown rents, in particular, were strong, jumping 3.6% year-over-year to $79.04 per square foot, which was the highest level since December 2008.
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