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NEW YORK CITY-As companies clamor to enter the already-tight Midtown South submarket, a large block of space could be coming on-line very soon. Media research company Nielsen is considering a move from 770 Broadway in NoHo to take approximately 160,000 square feet at MetLife’s 85 Broad St. in the Financial District, the ex-home of Goldman Sachs, according to published reports.
Unnamed sources told the Wall Street Journal that Nielsen has tapped CBRE to find a tenant to sublease its 770 Broadway space at the Vornado Realty Trust-owned building, which is also leased to tenants like AOL and J. Crew. If signed, the lease would be the latest in a series of moves by media companies flocking to Lower Manhattan from Midtown.
Last year, Conde Nast Publications brought national attention to the trend after signing on the dotted line for over one million square feet at One World Trade Center. But before that, companies like the New York Daily News moved from 33rd Street to 4 New York Plaza; Mansueto Ventures – publishers of Fast Company and Inc. – established their company headquarters at Seven World Trade Center; wedding publisher The Knot divorced from its space in SoHo for 195 Broadway; and the Harry Fox Agency departed Starrett-Lehigh for 40 Wall St. Even ALM Media LLC – parent company of GlobeSt.com and Real Estate Forum – is located at 120 Broadway.
While the report could not by independently confirmed by GlobeSt.com in-time for deadline, Nielsen’s proposed move is also a reflection of the favorability of pricing in the Downtown market as Midtown South rents continue to escalate. According to CBRE data, average asking rents in Lower Manhattan were $39.29 per square foot in June, while in Midtown South, average asking rents increased by nearly $8 from last year, jumping from $43.94 per square foot in June 2011 to $51.73 now.
And in addition to having the lowest office vacancy rate in the country (6%), Midtown South only has seven available blocks of space greater than 100,000 square feet, which has decreased by more than half since 2009, according to Cushman & Wakefield.
Frank Cento, an executive director at C&W, said during the company's last press briefing that Downtown is emerging as an alternative for users who cannot find space in Midtown South. “The demand is only going to increase in Lower Manhattan,” he said, noting that despite the wide spreads in rents, new leasing activity Downtown has exceeded the 10-year average five of the past six quarters.
A spokesperson for Nielsen declined to comment to GlobeSt.com for this article.
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