New York City office
and retail Market Research

July 2023

July 2023 New York Commercial Real Estate Market Report

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Manhattan Class A Landlords are offering up to 24% off of rent on concessions. Class B and C office landlords are offering a combined 16.8 to 21.3% of rent on concessions with terms of at least seven years.

The Retail rental rate bottom has been established for Manhattan Retail. Prices are unlikely to improve substantially until full office occupancy and tourism return to previous levels.

Building sales were slow. Underwater office landlords are negotiating, giving back the keys to their lenders.

New York Market Overview


Microsoft is subleasing more than 42,000 square feet.

Savanna exits 110 William Street as Pacific Oak restructures and the city agency takes 640,000 sf. The 20-year deal accounts for more than two-thirds of the entire footprint of the 32-story, 930,000-square-foot building. The tenant news comes as the owners reached an agreement with Invesco Real Estate to restructure more than $334 million in debt. Savanna will transfer its 40% ownership stake to Pacific Oak, . Pacific Oak would then invest between $110 million and $130 million of equity for tenant improvements. An existing $85.7 million mezzanine debt would be converted into preferred equity. The restructured loan is the existing senior loan balance; Pacific Oak could potentially withdraw $56.7 million for future building work.


Union Square Regal inks a new lease with Related. The movie theater had been slated to close after its parent company filed for bankruptcy. The theater underwent a multimillion-dollar overhaul just before the pandemic shuttered screens across the U.S. for nearly a year. Cineworld noted the plunge in domestic box office sales during the pandemic, as well as the monthly rent increase of nearly 30% per theater from 2019 to 2022.

The Distrikt Hotel is facing foreclosure and ordered to pay $46 million debt. Three individuals: Scott Schroeder, Victor Afonso and Kevin Fee were named alongside ownership entity 342 Property LLC in court filings. The Distrikt went into foreclosure in 2021 after shutting its doors throughout the pandemic. But the 32-story, 155-key hotel at 342 West 40th Street reopened when the court appointed a receiver in the case, though possibly too late for the owners to hang on to the Midtown property.

City rents from Pakistan for $220 million. NYC is moving a Migrant center to the Roosevelt Hotel at 45 East 45th Street in a three-year deal Over the 3 year term Pakistan International Airlines Corporation will earn $220 million. There are 1,025 rooms. The city is to pay as much as $210 in rent for each room of the hotel. as a migrant shelter.

Appeals court revives Howard Hughes’ Seaport project. Decision reverses lower court’s rejection of project in historic district. A state appellate court has unanimously reversed a decision that stopped Howard Hughes’ 250 Water Street project, paving the way for a residential tower to supplant a parking lot.

In January, a state court judge had voided the Landmark Preservation Commission’s approval of the 399-unit building, citing an “impermissible quid pro quo” between the developer and the commission.

At the time, Judge Arthur Engoron agreed that Landmarks’ approval of the project likely hinged on the developer’s promises to fund the South Street Seaport Museum. Ahead of the City Council’s approval of the project, the developer pledged to pay $40 million for air rights from nearby Pier 17 and the Tin Building, which would go toward the nonprofit museum.

Abraham Leifer puts downtown BK hotel project in bankruptcy. The nearly finished 21-story development faces claims by multiple creditors. An entity controlled by Abraham Leifer filed for bankruptcy to pave the way for a sale of 291 Livingston Street, a 21-story hotel project. The project is 95% complete, according to the bankruptcy filing, but needs another $6 million to get across the finish line.

Sedesco is going to demolish the 13-story building at 37 West 57th Street to develop a 63-story supertall at 41-47 West 57th Street. The project will include a mix of hotel, retail and residential space and rise 1,100 feet with 119 residences, 158 hotel rooms, 237,000 square feet of residential space and 206,000 square feet of commercial space. There will also be roughly 10,000 square feet for a restaurant. The developer is building two ADA-accessible elevators at the SW corner of West 56th Street and Sixth Ave for an extra 52,000 square feet to its project.

Tishman Speyer gets an extension on 300 Park Avenue’s $485 million loan. The extension adds just one year to the maturity date, but Tishman has an option to extend to August 2025.

Harry Macklowe is secretly orchestrating a deal to acquire a vacant Midtown office building at 14 East 52nd Street. Tim Ziss put a shell company into bankruptcy as a tactic to extend the closing which was purportedly in contract to buy from Alberto Palatchi.

Critics knock NYC for Vornado’s sweetheart Pier 94 deal that includes property tax exemption, low rent and city fixes at the studio site. The city promised $73.5 million to repair and maintain the pier until 2060, when Vornado would take over responsibility for the site. Tenants at other piers in the city are often tasked with maintaining their own properties, potentially costing millions each year. Vornado’s rent is a mere $4 per square foot, or $900,000 per year. That would escalate during the life of a 99-year lease, but it would still only top out at $2.8 million per year, in the 22nd century.

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