For a while now, Manhattan's office sector has been booming. But one part of the city has been particulary active — all office commercial buildings located on Park Avenue.
The latest report from Avison Young finds that the availability rate for those properties in that portion of the city dropped 280 basis points year-over-year to 8.2 percent in the fourth quarter That marks the lowest rate that Park Avenue has seen since 2018.
Leading the charge in driving down the availability are large deals in the space. This includes Blackstone leasing 696,000 square feet in the third quarter, JPMorganChase occupying 361,000 square feet during the same three-month period, and MetLife taking 385,000 square feet in the fourth quarter of 2023.
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“It’s no surprise that the Park Avenue availability rate has been decreasing, as tenants have been flocking to the Central Park, Grand Central and Midtown Core submarkets," Danny Mangru, senior manager, U.S. office lead of Avison Young Market Intelligence team, said in a statement.
"This is also a positive sign for the rest of the market because less availability here means tenants will have to find their space elsewhere in the city."
A full-year 2024 report from Avison Young recently revealed that dollar volume for investment sales in the entire Manhattan region rose by six percent year-over-year to $3.3 billion. While transactions were down four percent to 76, office is standing out. The asset class recorded 13 transactions for sales of $1.6 billion, representing surges of 86 percent and 98 percent respectively year-over-year, in the fourth quarter.
This year in Manhattan there has some been major activity in the office sector. For one, Jane Street Group signed a lease renewal and extension that will give it nearly a million square feet to work with at 250 Vesey Street, according to a report from Bloomberg. Plus, a separate report from Reuters noted that Blackstone is seeking an $800 million loan so it could purchase a sizable stake in 1345 Avenue of the Americas in Manhattan.
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