Manhattan Office Market Reaches Record Availability

The clouds failed to part for the Manhattan office market in April, marking another dreary month for commercial landlords in the borough.

A record 94 million square feet of office space was available last month, according to Colliers data reported by Crain’s. Tenants leased just 1.5 million square feet in the period, far below the monthly average from the three previous years.

The 17.4 percent availability rate also matched a record from February 2022, and marked a nearly 75 percent increase in available office space since March 2020.

Only two leases signed last month exceeded 100,000 square feet and just one additional lease surpassed 50,000 square feet. All three were renewals or extensions (or both).

Midtown was the star of the report as leasing volume rose from the previous month, but was still down year-over-year.

The neighborhood counted 891,000 square feet leased in the period to reach an availability rate of 15.6 percent. Average asking rent was $78.74 per square foot.

Trailing were Midtown South and Downtown, both of which also were down year-over-year.

For Midtown South, April was the slowest month in more than two years and the availability rate reached a record 17.9 percent, partially because of the space that came online at L&L Holding Company and Columbia Property Trust‘s Terminal Warehouse at 261 11th Avenue, and Vornado Realty Trust’s Penn 2. While those additions boosted the availability figure, they also helped boost the average asking rent to $81.77 per square foot.

Meanwhile, availability Downtown remained a stubborn 20.5 percent amid the slowest month of the year so far in the neighborhood. The asking rent was $58.69 per square foot and has fallen by 10.8 percent since the first month of the pandemic.

— Holden Walter-Warner