New York Market Overview

Office:

An analysis predicted that by 2029, the city’s office stock will drop in value by 28%, or roughly $49 billion, due to lease revenue falling and remote work rising further.

Office value declines could cost the city $600 million in annual property tax revenue. The city’s office market has a vacancy rate of 16%, while the sublease vacancy rate is 5%; both are higher than they were during recent economic crises.

The widespread increase in permanent hybrid work situations spurred a recent lift in the sublease market.

Sublease space available in Manhattan was more than 20.2 million square feet, down from the 22 million square feet available a year ago, but well above the 13.6 million square feet up for grabs in the first quarter of 2020.

Retailers are cutting back on hiring and employment there fell by 61,000 jobs. Still, the retail industry employs 159,000 more people than it did pre-Covid.

Industrious partners with Wolfson for 44K sf at Cunard Building at 25 Broadway in July to open a 44,000-square-foot flex office The coworking space is expected to have more than 350 seats.

Peloton listed 100,000 feet, about a third of its office space at Hudson Commons, to be subleased aka 441 Ninth Avenue. The space, costs Peloton about $95 per square foot. Its lease runs until 2035.

Yelp is shuttering its NYC and Chicago offices, after eyeing subleases for remote. San Francisco-based tech firm previously looked to sublet Vornado and SL Green offices in early 2021, 11 Madison Avenue and 200 Fifth Avenue.

Clifford Chance rents 144K sf at Brookfield’s Two Manhattan West.

The Teachers Insurance and Annuity Association is subletting 40,000 square feet to K2 Integrity at 730 Third Avenue. Asking rents for the sublease were in the mid-$60s per square foot.

Vornado Realty Trust and Rudin Management are in conversations with Citadel to become an anchor tenant and an investor at 350 Park Avenue The 1,450-foot-tall, 1.68-million-square-foot tower.

Retail:

Wilson sporting Goods signed a 4,000 Sf lease at One Columbus Circle

Atelier Adler signed a 6000 RSF lease at 382 West Broadway

Valentino signed a lease for 26,300 RSF at 654 Madison

Athleta signed a 4,900 RSF lease at 594 Broadway