New York Market Overview
Office:
Twitter listed 200,000 square feet of space up for sublease at its Chelsea offices. The connected buildings at 245 West 17th Street and 249 West 17th Street.Touro University at 3 Times Square adding 66K sf across two more floors bringing, total footprint in the tower to nearly 310,000 square feet.
STV leased 65,000 square feet at 350 Fifth Avenue and will occupy the full 10th and part of the 11th floor. Asking rent for the 16-year lease was $69 per square foot.
StubHub leased 3 World Trade Center and signed a 44,000-square-foot lease on the 59th floor of the 80-story office tower.
Axis Insurance signed a lease for 40,000 square feet at 1166 Sixth Avenue.
Retail:
MAC closed its flagship 1,700-square-foot store at 1540 Broadway. Mac still has six other locations in Manhattan.Primark, the Ireland-based clothing retailer, signed for a 54,600-square-foot, multi-level store at Queens Center mall at 90-15 Queens Boulevard in Elmhurst.
Manhattan’s major retail corridors had a better year in 2022 than they did in 2021 in terms of asking rents, with nearly half of its shopping strips seeing increases, sometimes significant ones while the declines were modest compared to the year prior.
Harlem’s 125th Street was priced more than 24% higher per square foot than in 2021. Broadway between Battery Park and Chambers Street down in the Financial District had rises of more than 28%, while asking rents along the Midtown South section of Broadway, from 14th to 23rd streets, rose by nearly 29%.
Asking rents along Fifth Avenue between 42nd and 49th streets, dropped by 13% year-over-year in the fall 2022. The West Village’s Bleecker Street between Seventh Avenue South and Hudson Street saw average rents drop by 9.6%, and East 86th Street between Lexington Avenue and Second Avenue suffered a drop of just over 9%.
Harlem’s 125th Street retail increased by 24 % than in 2021. Broadway between Battery Park and Chambers Street increased 28%. Midtown South section of Broadway from 14th to 23rd streets asking rent increased 29 %.
The West Village’s Bleecker Street between Seventh Avenue South and Hudson Street saw average rents drop by 9.6%.
East 86th Street between Lexington Avenue and Second Avenue suffered a drop of just over 9%.
Broadway running from Chambers Street down to Battery Park asking rents range from from $135 to $600 per square foot.
Herald Square corridor of West 34th Street between Fifth and Seventh avenues asking rents per square foot ranged from $171 to $1,000.
Broadway and Seventh Avenue between West 42nd and West 47th streets asking retail rents range from $300 to $2,300 per square foot.
Fifth Avenue between West 59nd and West 49th streets asking rents ranged from $2,250 to $3,000 per square foot.
Upper Manhattan Average Asking Rent ($/SF)
Charts below from REBNY Fall 2022 Manhattan Retail Report:
| Retail Corridor | Fall 2022 | Change from Fall 2021 |
|---|---|---|
| 125th St. (5th Ave - Morningside Ave) | $165 | 24.10% |
| Broadway (72nd St. - 86th St.) | $249 | 3.30% |
| Columbus Ave (66th St. - 79th St.) | $295 | 13.50% |
| East 86th St. (Lexington Ave - 2nd Ave) | $297 | -9.20% |
| Madison Ave (57th St. - 72nd St.) | $695 | -7.30% |
| 3rd Ave (60th St. - 72nd St.) | $216 | 0.80% |
Midtown Manhattan Average Asking Rent ($/SF):
| Retail Corridor | Fall 2022 | Change from Fall 2021 |
|---|---|---|
| East 57th St. (5th Ave - Park Ave) | $279 | n/a |
| 5th Ave (42nd St. - 49th St.) | $588 | -13.00% |
| 5th Ave (49th St. - 59th St.) | $2,583 | -1.70% |
| Broadway & 7th Ave (42nd St. - 47th St.) | $990 | -0.80% |
| West 34th St. (5th Ave - 7th Ave) | $445 | 14.10% |
| 5th Ave (14th St. - 23rd St.) | $250 | 1.80% |
| Broadway (14th St. - 23rd St.) | $397 | 28.90% |
Downtown Manhattan Average Asking Rent ($/SF):
| Retail Corridor | Fall 2022 | Change from Fall 2021 |
|---|---|---|
| 14th St. (9th Ave - 10th Ave) | $258 | -1.50% |
| Bleecker St. (7th Ave S - Hudson St.) | $226 | -9.60% |
| Broadway (Houston St. - Broome St.) | $343 | -3.90% |
| Broadway (Battery Park - Chambers St.) | $283 | 28.40% |
Midtown Manhattan Asking Rent Range ($/SF):
| Retail Corridor | Fall 2022 Low | Fall 2022 High |
|---|---|---|
| East 57th St. (5th Ave - Park Ave) | $150 | $610 |
| 5th Ave (42nd St. - 49th St.) | $436 | $750 |
| 5th Ave (49th St. - 59th St.) | $2,250 | $3,000 |
| Broadway & 7th Ave (42nd St. - 47th St.) | $300 | $2,300 |
| West 34th St. (5th Ave - 7th Ave) | $171 | $1,000 |
| 5th Ave (14th St. - 23rd St.) | $175 | $360 |
| Broadway (14th St. - 23rd St.) | $240 | $750 |
Source: Real Estate Board of New York Get the data Created with Datawrapper
Downtown Manhattan Asking Rent Range ($/SF):
| Retail Corridor | Fall 2022 Low | Fall 2022 High |
|---|---|---|
| 14th St. (9th Ave - 10th Ave) | $195 | $275 |
| Bleecker St. (7th Ave S - Hudson St.) | $128 | $350 |
| Broadway (Houston St. - Broome St.) | $225 | $510 |
| Broadway (Battery Park - Chambers St.) | $135 | $600 |
Upper Manhattan Asking Rent Range ($/SF):
| Retail Corridor | Fall 2022 Low | Fall 2022 High |
|---|---|---|
| 125th St. (5th Ave - Morningside Ave) | $110 | $208 |
| Broadway (72nd St. - 86th St.) | $175 | $385 |
| Columbus Ave (66th St. - 79th St.) | $175 | $350 |
| East 86th St. (Lexington Ave - 2nd Ave) | $155 | $390 |
| Madison Ave (57th St. - 72nd St.) | $300 | $1,000 |
| 3rd Ave (60th St. - 72nd St.) | $115 | $300 |
| Rank | Retail Chain | Category | 2022 | 2021 | 2020 | 2019 | 2018 |
|---|---|---|---|---|---|---|---|
| 1 | Dunkin' | Coffee Shops | 620 | 615 | 618 | 636 | 624 |
| 2 | Starbucks | Coffee Shops | 316 | 310 | 302 | 351 | 327 |
| 3 | Metro by T-Mobile | Cellular Telephones (Services) | 295 | 311 | 333 | 468 | 471 |
| 4 | Subway | Restaurants, fast-food | 254 | 269 | 257 | 287 | 330 |
| 5 | T-Mobile | Cellular Telephones (Services) | 233 | 241 | 256 | 245 | 252 |
| 6 | Duane Reade | Pharmacies | 227 | 249 | 253 | 317 | 263 |
| 7 | McDonald's | Restaurants, fast-food | 191 | 191 | 198 | 203 | 207 |
| 8 | Baskin-Robbins | Ice cream | 182 | 175 | 171 | 217 | 227 |
| 9 | CVS/Pharmacy | Pharmacies | 174 | 175 | 172 | 170 | 158 |
| 10 | Popeye's | Restaurants, fast-food | 137 | 134 | 116 | 105 | 99 |
| 11 | AT&T | Cellular Telephones (Services) | 119 | 119 | 135 | 136 | 118 |
| 12 | Rite Aid | Pharmacies | 109 | 109 | 109 | 119 | 178 |
| 13 | 7-Eleven | Other retail | 105 | 116 | 132 | 141 | 141 |
| 14 | Burger King | Restaurants, fast-food | 105 | 104 | 97 | 104 | 103 |
| 15 | Chipotle Mexican Grill | Restaurants, fast-casual | 105 | 95 | 85 | 79 | 79 |
| 16 | Key Food | Grocers | 99 | 104 | 103 | 108 | 113 |
| 17 | Verizon | Cellular Telephones (Services) | 97 | 96 | 25 | 27 | 32 |
| 18 | UPS Store | Other retail | 96 | 94 | 92 | 87 | 87 |
| 19 | Domino's Pizza | Pizza | 90 | 89 | 90 | 88 | 91 |
| 20 | Taco Bell | Restaurants, fast-food | 75 | 68 | 40 | 40 | 32 |
New York City’s hotels enjoyed a comeback last year. Those that survived the devastating effects of the pandemic.
| Year | Occupancy | ADR | RevPAR | RevPAR % of 2019 |
|---|---|---|---|---|
| 2020 | 46.7% | $152.14 | $71.02 | 32.5% |
| 2021 | 59.3% | $210.92 | $125.13 | 57.2% |
| 2019 | 86.1% | $253.92 | $218.75 | |
| 2022 | 74.8% | $287.67 | $215.16 | 98.4% |
Host Hotels & Resorts unloaded the Sheraton New York Times Square to MCR Investors for $323 million, a haircut for Host, which purchased the 51-story hotel for more than twice that, $738 million, in 2006.
Top NYC hotel sales of 2022
| Rank | Address | Sale Price | Buyer | Seller |
|---|---|---|---|---|
| 1 | Sheraton New York Times Square Hotel, 811 Seventh Avenue, Times Square | $323.3M | MCR Investors | Host Hotels & Resorts |
| 2 | The Fifty Hotel, 155 East 50th Street, Turtle Bay | $99.8M | Sonesta International Hotels Corporation | 155 East 50th Street Co. |
| 3 | Shelburne Hotel, 303 Lexington Avenue, Murray Hill | $89.8M | Sonesta International Hotels Corporation | 303 Lexington Avenue Co. |
| 4 | Holiday Inn, 121 West 26th Street, Chelsea | $80.3M | Two Kings Management | Watermark Lodging Trust |
| 5 | Excelsior Hotel, 45 West 81st Street, Upper West Side | $79.8M | Emmut Properties | Harry Krakowski |
| 6 | The Gardens, 215 East 64th Street, Lenox Hill | $71.6M | Sonesta International Hotels Corporation | 215 East 64th Street Co. |
| (tie) 7 | Hilton New York Fashion District, 152 West 26th Street, Chelsea | $67.9M | Dong Yin Development (Holdings) Limited | Pure Virtue Enterprises |
| (tie) 7 | Hilton Garden Inn New York, 63 West 35th Street, Garment District | $67.9M | Dong Yin Development (Holdings) Limited | Pure Virtue Enterprises |
| 9 | The Benjamin Royal Sonesta New York, 557 Lexington Avenue, Turtle Bay | $63.1M | Sonesta International Hotels Corporation | 125 East 50th Street Co. |
| 10 | Staybridge Suites, 38-59 11th Street, Long Island City | $63M | 38-59 11th Street | 559 Development |
Brooklyn Office Market:($/SF):
Brooklyn’s office market was not immune to the pain inflicted on the sector nationwide in 2022.
The vacancy rate held mostly steady at about 21% last year, but net absorption in the fourth quarter crashed from around 279,500 square feet in 2021, down to 950 square feet at the close of 2022. Though it’s worth bearing in mind that the fourth-quarter does represent a significant recovery from the third quarter’s abysmal net absorption of -473,350 square feet.
61% Year-over-year drop in Q4 leasing activity from 2021 to 2022.
Leasing activity plummeted in the last quarter of 2022, versus the same period in 2021, dropping by two thirds from 472,300 square feet to just 183,000 square feet.
The biggest office lease signed in Brooklyn last year was a renewal by the city’s Department of Finance for 135,700 square feet at 147 41st Street. The largest new lease was for nutritional supplement company Care/of, which took 79,500-square-foot space at 850 3rd Avenue.
| Indicator | Q4 2022 | Q3 2022 | Q4 2021 |
|---|---|---|---|
| Vacancy Rate | 21.10% | 21.10% | 22.10% |
| Net Absorption (SF) | 949 | -473,347 | 279,456 |
| Average Asking Rent ($/SF) | $50.43 | $51.91 | $49.14 |
| Leasing Activity (SF) | 182,990 | 265,132 | 472,289 |
Top 5 Brooklyn office eases of 2022:
| Tenant | Address | Size (SF) | Type | Period |
|---|---|---|---|---|
| NYC Department of Finance | 147 41st Street | 135,689 | Renewal | Q2 |
| Care/of | 850 3rd Avenue | 79,533 | New | Q1 |
| New York Embroidery Studio | 140 58th Street | 79,340 | New | Q1 |
| Vice Media | 289 Kent Avenue | 77,700 | Renewal | Q2 |
| Huge | Dock 72 | 70,925 | New | Q3 |
The city still has fewer hotel rooms than it did before Covid. Hotel revenue per available room (or RevPAR) reached $215.16 in 2022, up 48% from 2021 to fall short of the $218.75 figure recorded in 2019. Occupancy was 74.8% last year significantly higher than 2021, but still down more than 13% from 2019.
NYC life science Tenants leased 455K SF. Average rent in the sector broke a record at $108.47 per square foot, King Street Properties’ 45-18 Court Square West. NYU inked a deal to take 92,000 square feet at the property, known as Innolabs. NYU School of Medicine took 56,000 square feet at Deerfield Management’s 345 Park Avenue South.
Life sciences rented 2.7 million square feet, up from 1.9 million square feet last year. 700,000 square feet was rented in Brooklyn. Longfellow Real Estate Partners’ property at 43-10 23rd Street delivered 200,000 square feet last year.
