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1.4 million sf of office leases were signed in Manhattan, a 43% decrease from a year ago. 17.0% of Manhattan offices are vacant. Asking rents remain high but Landlords have increased concessions so that tenants are getting a lower net price. Landlords are desperate to fill their vacant spaces.

The apparel industry signed 27 leases for 243,000 square feet. LVMH took 43,000 square feet at 4 East 57th Street. Food and beverage companies had more than a dozen more deals than apparel, but for roughly 100,000 fewer square feet overall.

Investors remained mostly on the sidelines for the quarter, totaling $980 million — an 85% year-over-year decline.

New York Market Overview

Manhattan Retail Market:

Burberry rented a short term lease at 693 Fifth Avenue. This means the cash flow from the property is short of revenue to cover its $250 million loan. Burberry took 14,000 square feet of retail space, 15% of the property at 693 Fifth, paying just $372 annually per square foot, a third of the $1,144 that Valentino agreed to pay when it inked a 15-year lease in 2013.

David’s Bridal layoffs target 14 New York stores including three locations in New York City: including 45 West 25th Street in Manhattan, Plaza 48 at 3460 48th Street in Queens and three on Long Island and the 12th floor of an office building at 264 West 40th Street.

Janet Mandell, who rents space to fashion houses for a few days at a time, signed a 5K SF lease at 24-28 West 25th St. The asking rents were $150 per SF.

Starbucks signed a 2K SF lease at 2360 Broadway.

New Balance signed a 4K SF lease at 210 Columbus Avenue.

Ground-floor retail availability declined from 222 available spaces to 206, the seventh consecutive quarter with a drop in availability.

The average asking rent was $638 per square foot, a gain of 3.7% from the fourth quarter and 8% year-over-year.

In Flatiron/Union Square, 12 leases were signed for roughly 100,000 square feet. The biggest among them was J. Crew’s 27,000-square-foot renewal at 91 Fifth Avenue.

Louis Vuitton is going to build a new Fifth Avenue flagship store. LV is planning to build a new building on the northeast corner of Fifth Avenue and East 57th Street after demolishing the 19-story property at 1 East 57th Street, as well as the adjacent 743 Fifth Avenue.

Barnes & Noble renewing 35,000 square feet at 557 FIfth Avenue.

TMPL fitness clubs leased 28,000-square-foot at 200 Madison Avenue.

A Japanese restaurant signed a 15-year deal for the 8,700 square feet at 87 Seventh Avenue. The building has 2,800 square feet on the ground level, a 1,700-square-foot second story roof deck and another 4,100 square feet on a lower level. The asking rent was $50,000 per month.

Vital Climbing Gym signed a lease at 182 Broome Street, Essex Crossing, for 45,000 square feet across three floors.


In February and March, lease volume was primarily from existing tenants renewing or extending existing leases.

The average asking rent in Midtown was $78.35 per square foot in the first quarter, the lowest since June 2015.

Manhattan Office tenants rented 7.4 million square feet of office space in the first quarter, a 49% increase from the fourth quarter, but still about 270,000 square feet short of last year’s first quarter. Net absorption was negative 1.2 million square feet and average asking rents declined in all three submarkets.

Manhattan’s office leasing volume was more than 6% below the five-year rolling average of 7.9 million square feet and 11% below its ten-year rolling average of 8.3 million square feet.

Midtown’s average asking rent dropped to $78.35. Midtown South dropped from $79.95 per square foot in the first quarter of 2022 to $80.33 now.

Manhattan’s availability rate increased for a second straight quarter, climbing 0.2 percentage points to 17.1%. Midtown South reached a record high of 17.2%.

FIRE and TAMI tenants accounted for more than 70% of office leases signed in Manhattan last quarter. While that trend was consistent in Midtown and Midtown South, tenants in professional services and the public sector made up close to 60% of Downtown office leases.

Fox and News Corporation’s combined 1.1 million-square-foot renewal at 1211 Sixth Avenue, and two leases signed by Citadel at 350 Park Avenue and 40 East 52nd Street.

Wilson Sonsini Goodrich & Rosati signed a 119,000-square-foot, 16.5-year lease at 31 West 52nd Street.

JPMorgan cut its New York City office footprint to 6.8 million from 9 million square feet. JP Morgan sublet 700,000 square feet at 4 New York Plaza and sold 350,000-square-foot at 3 MetroTech Center. JPMorgan is focused on centralizing its operations around 270 Park Avenue; the 2.5 million-square-foot development is expected to be completed in 2025.

Vista moved into larger space, leasing 95,000 square feet at 50 Hudson.

Milbank rented an additional 28,000 square feet, bringing its total footprint at the property to 315,000 square feet.

Liberty Mutual took 20,000 square feet at 50 Hudson Yards.

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