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Office:
Manhattan office vacancy decreased, as office demand increases and office buildings are being converted to residential or warehoused.

650 Office building owners have expressed interest in converting to residential once the City of Yes has been approved. Manhattan office tenants signed deals for 23.1 million square feet in the third quarter, a 25.1% jump year-over-year. The vacancy rate dropped to 18.7% in the third quarter, the first time the quarterly rate fell below 19% since the first quarter of 2021.

Retail:
The availability rate for retail space was 14.7% for the third quarter of 2024 with 202 vacant shops. This was down from 15.3% availability rate and 210 vacant stores in the second quarter of the year. Largest leases were for schools, event spaces and retail stores.

Sales:
Many Class A and B office buildings that were overleveraged are coming back to lenders through UCC auctions and negotiated jingle mail.

New York Market Overview

Office:

Developers are looking to build 71,000 apartments with the extension to the lapsed 421a property tax break. Nearly 650 buildings have sent letters of intent to qualify for the extension, which would give them until June 15, 2031, to complete them. 33,000 planned apartments would not be built unless the state legislature extended the 421a construction deadline beyond June 2026.

  1. Bloomberg signed a lease for 925,000 square feet at 919 Third Avenue, bringing its total long-term office commitment in Manhattan to nearly 2 million SF.
  2. Amazon is negotiating for 350,000 SF at 452 Fifth Avenue for occupancy in 2025.
  3. Google inked a 300,000 SF renewal for its space at 85 10th Avenue for eight years. The asking rent was $100 per foot.
  4. DSM-Firmenich took 45,000 SF at 641 Sixth Avenue with an asking rent of $118 per SF.
  5. The Chan Zuckerberg Initiative has signed for 38,000 SF at 615 West 131st Street for a Biohub in New York.
  6. Mirae Asset Securities has signed a 35,000 SF lease at 810 Seventh Avenue for 12 years.
  7. The Brandtech Group signed for 15,000 SF at 155 Sixth Avenue. Asking rent was $85.00 per SF with Brandtech taking the entire 11th floor for 10 years.
  8. Blue Owl Capital expanded in the Seagram Building at 375 Park Avenue and will now have a total of 240,000 SF, increasing their space by 42% and occupying the second through sixth floors as well as the 16th through 19th floors.
  9. Yeshiva University’s 32-year lease for 160,000 square feet at 1293 Broadway for a new health care campus.
  10. OpenAI leased 90,000 square feet at Puck Building in Soho.
  11. The Chan Zuckerberg Initiative leased 38,000 square feet from Columbia University to house the Chan Zuckerberg Biohub New York. The deal is for space in Columbia’s Studebaker Building at 615 West 131st Street. Asking rent for the space was not disclosed.
  12. New York City’s Department of Housing Preservation and Development renewed its lease for office space for its Office of Enforcement and Neighborhood Services’ Emergency Operations Division for 27,000 SF between 104 and 105 East 106th Street for two years with an annual rent of $1.1 million.
  13. AIS leased 12,600 SF at 257 Park Avenue to expand its showroom.
  14. Middlegate Securities extended its 13,000 SF lease at 8 West 40th Street for ten years.
  15. Merlyn Mind renewed its lease at 8 West 40th Street of 7,000 RSF for two years.

Retail:

The availability rate for retail space was 14.7% for the third quarter of 2024 with 202 vacant shops. This was down from 15.3% availability rate and 210 vacant stores in the second quarter of the year.

In 2019, the availability rate was 21% and reached 28% during the COVID shutdowns in 2021. Availability rates on Madison Avenue and near 34th Street/Herald Square were 6.4% and 33.3%, respectively.

Lower Fifth Avenue and SoHo’s availability rates fell to record lows of 11.3% and 11.5%, respectively. Average asking rents during the third quarter ranged from $238 per square foot in Williamsburg, Brooklyn, to $2,257 per square foot on Upper Fifth Avenue. Rents are still below the average asking rents seen pre-pandemic.

  1. Primark is leasing 79,000 square feet at 150 West 34th Street, including 54,000 square feet for a flagship store with an opening in 2026. The asking rent for the property was $10 million.
  2. Convene is signing a deal for 72,000 square feet at 30 Hudson Yards for a new event venue.
  3. School in the Square taking 60,000 square feet at 4650 Broadway.
  4. Arte Museum signed a lease for 52,000-square-foot at Chelsea Piers.
  5. Luxury spa Mystery tenant takes 43,000 sf at 660 12th Avenue and signed a 23-year deal with the Bay Ridge Auto Group. The asking rent in the deal was $75 per square foot.
  6. 99 Ranch Market leased 44,000 sf at 37-11 Main Street in Flushing.
  7. Moncler Group subleased 24,000 SF, a portion of Under Armour’s retail space at 767 Fifth Avenue.
  8. Dog PPL leased 18,000 SF at 12 Berry Street in Williamsburg.
  9. Yeshivat Darche Eres leased 18,000 sf at 1870 Stillwell Avenue.
  10. Rosa Mexicano relocated to 1889 Broadway, renting 12,000 sf relocating from 61 Columbus Avenue.
  11. Snipes leased 6,900 SF at 815 Hutchinson River Parkway.
  12. Sephora leased 6,200 SF at 385 Ninth Avenue.
  13. Paulie Gee’s Slice Shop leased 4,400 SF at 305 Nevins Street.
  14. Casa Tua leased 3,700 SF at 83 Gardner Avenue.
  15. Wonder leased 3,200 SF at 1029 Fulton Street.
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