market research

May 2019

May 2019 New York Commercial Real Estate Market Report

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Manhattan Office:

Strong office demand continues and vacancies declined last month by 890,0090 RSF to 34.83 million RSF. Average Manhattan office rents continue to climb to an average of $76.50/RSF.

Manhattan Retail:

Continuing retail closings put additional pressure on retail pricing. There is new retail demand from web retailers adding physical stores and food halls continuing to expand using large blocks of empty retail space.

New York Market Overview

  • Total Manhattan Class A Office vacancies decreased from 10.2 % vacant to 10.1 % vacant
  • Total New York City Office vacancy increased from 7.8 % vacant to 8.0 % vacant

Manhattan Office:

More than 9 million square feet has been leased to date this year, 20% increase year-over-year from 2018 to 9.07 million square feet.

Asking rents reached record highs averaging $76.57 a square foot, up from $73.06 from Q1 2018.

Downtown leasing volume of 2.56 million square feet was up 6.4% from the last quarter of 2018. This was in part due to the We Company’s 201,000 square foot lease at 199 Water Street.

Midtown South leasing volume declined 17.1% for the first quarter of 2019, with 2.22 million square feet leased and was down 47.2% from December 2018.

The Plaza District neighborhood had leasing activity of 1.61 million square feet.

Total Manhattan Class A Office vacancies decreased from 10.2 % vacant to 10.1 % vacant

Manhattan Retail:

The largest retail deals are being signed by department stores and clothing retailers followed by restaurants. This new demand was undercut by continued retail closings by national chains such as Payless, Gymboree and Charlotte Russe.

The 10 biggest retail lease deals signed totaled 194,000 square feet, up 5,900 square feet from last months total of 188,100 square feet.

5,994 stores have closed in the U.S. so far this year, more than last year’s total of 5,864. Retailers that have announced plans to close stores this year include Payless ShoeSource, Gymboree Group, and Charlotte Russe Holding.

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