Manhattan’s Downtown and Midtown South Garner Leasing Wins
Downtown and Midtown South in Manhattan garnered some leasing wins in 2019 and is expected to continue on track for continued leasing strength well into 2020.
NEW YORK CITY – Downtown and Midtown South in Manhattan garnered some leasing wins in 2019 and is expected to continue on track for continued leasing strength well into 2020, Frank Wallach, senior managing director of research at Colliers International, tells GlobeSt.com.
Driven largely by demand from the technology, advertising, media and information services (TAMI) sector, Midtown South’s availability is reportedly the tightest in Manhattan on par with asking rents in other submarkets with the highest asking prices in Manhattan like Hudson Yards, Manhattan West and Greenwich Village, according to Wallach.
Full-year 2019 Midtown South leasing was 16.4 million square feet, the strongest since 2001. In January and February of 2020, the largest single leases in Manhattan took place in Midtown South with Debevoise & Plimpton at 66 Hudson Boulevard for 531,000 square feet in January and Apple Inc. at Penn 11 for 220,000 square feet in February, according to Colliers International data.
Meanwhile, Downtown’s availability rate at the end of February was 10 percent, the tightest since 2008 thanks to leases from MDC Partners, Hana and Alger in February. “For that reason, Downtown came off of a record year of leasing. In 2019, Downtown leasing volume was 10.7 million square feet and was the strongest full-year of leasing so far this century,” Wallach said.
According to a recent GlobeSt.com article, Midtown leasing activity saw a steady decrease in volume in 2019 at an estimated 25 percent from the previous year and is on track to see the highest quarterly supply of office inventory in nearly five years with a chance it may not remain stable, according to Wallach.
For the year 2019, Midtown leasing volume totaled 15.8 million square feet, marking a six-year low and ended the year with an availability rate of 11.1 percent, the highest quarterly supply of office inventory in close to five years. In addition, leasing activity in Midtown was lower during the first two months of 2020 at 2.5 million square feet compared to 3.2 million square feet.