Office leases continue to be an unpredictable category for Manhattan’s commercial landlords, but the “flight to quality” in the sector last year powered a bump in high-dollar deals.
There were 190 leases of at least $100 per square foot last year, according to JLL’s Year-End Recap reported by the New York Post. The figure was a record number of new leases at the price point, beating the 164 leases recorded in 2021.
The $100-per-square-foot leases accounted for 6.1 million square feet in the borough, more than doubling the space of premium leases from a year earlier. There were 15 leases for at least $200 per square foot (totaling 280,000 square feet) and two leases at SL Green’s One Vanderbilt that crossed the $300-per-square-foot threshold.
One of those One Vanderbilt leases likely belongs to Canadian-based environmental services company GFL Environmental, which signed a deal in the spring for 9,900 square feet on the property’s highest office floor, directly below the Summit observatory. The asking rent for the space was $322 per square foot.
A majority of leases at the premium price point — 62 percent — occurred at buildings that were either new or recently upgraded.
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The big winners of $100-per-square-foot leases were a who’s who of top office landlords in the city. RFR Realty landed the most deals of the group with 19, although those deals accounted for the least amount of space at 386,000 square feet. Brookfield Properties accounted for 1.6 million square feet with its 16 deals.
SL Green had 17 deals for 842,000 square feet, while Related Companies boasted 11 deals for 703,000 square feet.
“Many tenants elected to commit to higher-end space while focusing on right-sizing their operations post-COVID,” said JLL vice-chairman Cynthia Wasserberger. “The trend of ‘paying more for less’ and prioritizing quality over quantity benefitted top properties more than ever.”
— Holden Walter-Warner