New York Market Overview
- Total Manhattan Class A Office vacancies decreased from 9.5 % vacant to 9.3 % vacant
- Total New York City Office vacancy decreased from 8.3 % vacant to 8.2 % vacant
The United States is still the most attractive country to invest in for real estate. The top three cities are Washington D.C, New York City and San Francisco. Based upon investment sales this year, it looks like Israeli investors who have invested in the Big Apple are once again becoming very bullish on Manhattan. Earlier this month, Gaia Real Estate announced a partnership with Harel Insurance Investments & Financial Services, one of Israel's largest insurance companies, to invest in residential real estate throughout the U.S., with a particular focus on buying rental buildings in the New York area.
After an overall strong second quarter, Manhattan's prime shopping corridors showed mixed results last quarter with rents falling or remaining flat and vacancy rates climbing in more than half the districts. Of the seven districts, asking rents fell or were flat in three, and vacancy rates rose in four.
Prices were down the most in Times Square, where they dropped $40 per foot to $651 per square foot. This was in part because sunglass and sports retailer Oakley signed a lease at 1515 Broadway for around $1,400 per square feet for about 1,800 square feet of ground-floor retail. With the removal of the above-market space, the overall asking rents fell. The shopping district where the vacancy rates rose the most was upper Fifth Avenue between 49th and 60th streets, where it jumped 1.5 points to 8.1 percent.
The strongest district was lower Fifth Avenue, between 42nd and 49th streets, which was the only stretch to show both growth in asking rents and a decline in vacancy rates. Asking rents rose from $87 per foot to $501 per foot, while the vacancy rate dipped .15 points to 6 percent. The largest new lease there was Urban Outfitters, which leased 25,866 square feet at 521 Fifth Avenue. Brokers remain confident in Manhattan retail, noting the healthy growth in certain areas. In Soho, where the vacancy rate fell .9 points to 9 percent, there were only a few spaces available, and spots were leasing up quickly.