Transwestern’s Q3 report on the Manhattan office market reveals a combination of positive and negative trends. Leasing activity decreased to 5.0 million square feet in the quarter, with notable deals such as DavisPolk’s renewal and expansion of 708,000 square feet. However, net absorption was strong at 1.9 million square feet – the highest it has been in nearly five years.
According to Corrie Slewett, Transwestern’s research manager: “We observed an increase in office usage during this quarter as many large employers implemented policies for employees to return to work in person; however, there needs to be a sustained rise in demand for it offset availability which remains high.”
Overall availability declined slightly from last quarter at 18.7%, while sublet availability also dropped down by removing over two million square feet of sublease space from the market – now sitting at just 4.4%. Average asking rents increased by one percent compared with Q2 reaching $74.54 per square foot – marking its highest point since late last year.
Office construction remained low due largely because of ongoing uncertainty within this sector; instead focusing on renovations and reconstructions particularly within Class B buildings.
The article titled “Manhattan Office Shows Mixed Trends In Q3” originally appeared on Connect CRE.
