Q1 2019 NYC Market Report

The Manhattan Office market ended the first quarter 2019 with a vacancy rate of 8.0% – up from 7.9% over the previous quarter. The availability rate decreased marginally from 11.9% to 11.7%.  Rental rates increased during the first quarter, reaching an average of $78.98 PSF. 

Q1 2019 ended with portions of the Hudson Yards megaproject opening to the public (the mixed-use, multi-property, modern and amenity rich project on the west side of Midtown). A concerning trend is the lack of new tenant entrants into Manhattan, for much of the new stock is being absorbed by existing tenants.

Market Trends

  • Coworking firms make up 12 percent of office leasing volume 
  • Increasing amount of sublease space in Manhattan makes up nearly 30 percent of all available space 
  • Workspace trends have reduced the average footprint from 300-400 square feet per employee to less than 200 square feet
  • The demand for updated office space has been expanding beyond Manhattan into North Brooklyn, Downtown Brooklyn and Northwest Queens