If anyone is looking to lease office space in Manhattan, there is no shortage of choices – two new data reports point to historically high vacancy rates in the heart of the Big Apple.
Data from Colliers determined the borough’s office availability rate in the first quarter was 18.1%, the highest on record. This is up from 17.9% in the fourth quarter of 2023 and up from 17.1% in the first quarter of 2023. In the pre-pandemic first quarter of 2020, the rate was 10%.
The Colliers data, which was first reported by Crain’s New York, includes offices that are currently empty and those that will become vacant in the very near future.
“We are still waiting for demand to catch up and surpass supply,” said Colliers Executive Managing Director Franklin Wallach. “It’s still the early innings of 2024, and there are both a fair number of large leases pending and a large number of tenants in the market. But we also anticipate some large blocks of space to be added.”
Separately, first quarter data from Savills found the office availability rate at 20.1%, also a record peak. During the quarter, asking rents for Midtown-based Class A office properties were $90.92 per square foot, down 3.2% from one year earlier.
“That has to do with much of the leasing activity that continues to be concentrated at that top or higher-end part of the market,” said Marisha Clinton, Savills’ vice president for research in the Eastern region, in a Bisnow.com interview. “When you have stronger leasing in that high end of the market, what’s left? You’re leaving the lower-priced products available.”
