NEW YORK CITY—The 2014 Manhattan office market had a milestone year in many ways, and despite a slight drop in the fourth quarter, showcased the strongest full year of leasing activity in more than a decade, according to new research from Colliers International, revealed EXCLUSIVELY to GlobeSt.com. In addition to an improving economy and job growth, technology, advertising, media and information services sector tenants continued to dominate the market, with four of the year's top ten leases.
Meanwhile, Manhattan's ever-evolving landscape continued its reshaping as 2014 saw the completion of several long-awaited office and infrastructure projects, including One World Trade Center, the Fulton Center, the 9/11 Memorial Museum, the final section of the High Line and the platform that will eventually hold Brookfield Properties' Manhattan West project.
This activity is expected to continue this year with delivery of new office towers at 860 Washington St. and 10 Hudson Yards, the 800,000-square-foot World Trade Center Transportation Hub and the 7-train subway line extension to the Far West Side at West 34th street and 11th avenue.
“The overall Manhattan office market in 2014 showcased the strongest year we've seen since before the downturn,” says Joseph Harbert, eastern region president for Colliers.
Manhattan leasing activity in the fourth quarter was 8.3 million square feet. Full-year 2014 leasing of 36.7 million square feet surpassed the previous year's 33.9 million square feet by over 8%, the strongest full year of leasing since 2003, which reached 38.2 million square fet.
Manhattan's availability rate dropped slightly to 10% from 10.2% in the third quarter and 11.7% year ago. The current rate represents the tightest market since the 8.4% mark was reached in the third quarter of 2008.
Overall average Manhattan asking rent reached $66.52 per square foot in the fourth quarter, up nearly 1% percent from $65.97 per square foot the previous quarter and 10% higher than $60.46 per square foot a year ago. In fact, a total of 20 leases in Midtown and Midtown South were completed at starting rents of $100 per square foot or greater, including three leases at or above $200 per square foot.
Stay tuned for part two of this story, which will reveal Colliers' report on the performance of each of Manhattan's submarkets in Q4 and the firm's predictions for this year.
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Rayna Katz
Rayna Katz is a seasoned business journalist whose extensive experience includes coverage of the lodging sector, travel and the culinary space. She was most recently content director for a business-to-business publisher, overseeing four publications. While at Meeting News, a travel trade publication, she received a Best Reporting award for a story on meeting cancellations in New Orleans during Hurricane Katrina.
