The office scene in downtown Manhattan continued its COVID spiral in the first quarter, with leasing activity coming in at less than half of Q4 2020 volume and nearly four-fifths lower year-over-year.

A new report from Colliers shows that Lower Manhattan's office leasing activity this quarter was 0.35 million square feet, down from 0.75 million square feet in the fourth quarter and staggeringly lower than the 1.69 million square feet recorded pre-pandemic in the first quarter of 2020. The leasing velocity this quarter was also a fraction of the pre-pandemic quarterly average, the report states, and Lower Manhattan's availability rate increased by 2.6 percentage points to 16.5%, the highest quarterly rate since 2013. Net availability in the submarket increased by 61.5% over Q1 2020 numbers.

The first quarter numbers were particularly low due to a lack of high-profile, blockbuster deals. Q1 leasing volume did not include any transactions at the 250,000+ or 100,000+ square foot levels; the biggest leases included the State of New York's 65,000 square foot new lease at 199 Church Street, a 27,000 square foot renewal by IPC systems at 1 State Street Plaza and a 27,000 square foot renewal by Public Health Solutions at 40 Worth Street. The public sector led leasing for the region, accounting for 40% of activity in Lower Manhattan during the quarter.