Midtown's best buildings are signed. Now, even the second and third class offices disappear quickly from the market, as the work area is transferred 5.5 million square feet for residential use. But there is a big winner of the crisis: lower manpache.
“The city center has become incredibly narrow for the great tenants looking for a high -quality space,” said Jonathan Mazur, a research analyst in Newmark. “The city center has always been the most cost -effective market and has the largest chance for the large tenants to rent.”
There is a large area for the upscale box because last year, it was in the city center the least amount of leasing ever. “Those of us in the market are witnessing now and participate in a strong activity,” said John Wheeler of JLL. “After twelve months from now, you will see a lot of stories about rental contracts and ask,” Where did that come from? “” “
For example, Jane Street Capital 983,791 raised square feet in Brokefield Plies with its 600,000 square feet expansion at 250 Vesey Street, causing builders owners, in Brookfield asset asset assets, as well as other tenants, to get out of the road. The kidney board for one inside the complex will move to 41,000 square feet at 225 Liberty.
In the first global trade, almost two tenants double.
“We have become the largest Tami, a variety [technology, advertising, media and information] Erik Engelard of Dorset, who owns and runs the property at the Port Authority in New York and New Jersey, said:
One of the tenants takes the first office in the city and another to move from the area. “Opinions and facilities are attractive to them,” said England.
In addition, Axsome Therapeutics has rented it on an additional 48,000 square feet from Conde Nast, which wears its job to 96,000 square feet, while BNY Mellon negotiates a four -year settlement for 200,000 square feet for use while renovating its headquarters at 240 Greenwich St.
For April, CBRE has reached 127,000 square feet of leasing with now 1.55 million square feet-an increase of 122 % of 2024. The average request for $ 57.39 for the United States is a deal compared to $ 82.90. Keep in mind that even in the city center, category A rents will push to the eighties of the last century for each foot or even three high -floors in the first world trade.
“The Manhattan Market in general threw approximately 70 % of the sub -leasing space added during the epidemic … a lot was absorbed. ”
Jonathan Mazur, research analyst in Newmark
American Express is still negotiating with Larry Silvrvstein to consolidate a new global commercial center, but everyone says: “It is complicated.”
The sources familiar with the conversations say that AmeX will take the lower floors of the tower from 2.5 million to 3 million square feet and include many amenities for their employees. But the financial company still discovers the amount of space you will need when it opens about five years or more.
Silferstein, 93, on May 30, should know the amount of square shots he needs to rent others and at rent, which can be $ 150 per foot or more for the current cup rents in the city center in the eighties of the last century.
For tax reasons, Amex may sell its current fossils and buy its part of the new tower, similar to what it has done related to the Office Hudson Yards, which has created a strong financial model for lenders.
Once they reach the exact numbers, the American Express will have to agree to the deal.
Meanwhile, the city center deals recently include moving by MasterWorks from Brookfield 225 Liberty St. To the World Trade Center 1 in subcontracting a 37,000 square feet of Network Capital. Uber also expanded to 351,000 square feet by leasing 44,000 square feet from Silverstein Properties in 3 global trade centers.
The expansion of tenants and the absorption of sub -storms helps the market in general. San Francisco -based Stripe opened in New York in 2019 in 199 Water St. A year ago, it expanded and moved to 28 Liberty, as it was affected by 147,000 square feet. When other tenants faced negotiations to prepare their floors already, Wheeler said they “hit the temporary stop button.”
“We now see sublandlords take space for their own needs,” said Wheeler.
In less than two years, the NewMark statistics showed 35 % in the city center, as it decreased from 6.6 million square feet in the second quarter of 2023 to 4.3 million square feet at the end of April.
“Not every tenant is the arenas of Hudson or a Park Avenue tenant and those most sensitive to prices or are looking for economic treatment that appears in the city center“
Erik England from Dorst
““The Manhattan Market in general threw approximately 70 % of the sub -leasing area during the epidemic.” It has been absorbed a little. ”
The newly advanced 107 Greenwich will be rented by 96 %. Although most of the deals were one floors, one now two floors.
On the eighteenth floor, which contains an external view of a landscape, the owner Treente created a floor on the latest floor of rest. There are now conference rooms, full kitchen, café/bar. As another unusual stadium, the gym in the basement and basketball in Trinity Commons is used to program schools in the area open to tenants from 6 am to 9 am
While there is a rental activity on the area of Class A, many of them are currently coming from musical chairs – that is, tenants who were forced to move due to transfers or upgrade on a trip to quality from another area in the lower Manhattan.
The rehabilitation of Wall Street 60 million square feet 60 square feet also rented. The Lawyer with a white shoe company weighs Sullivan & Cromwell a transition from 125 wide streets and seeks to get 500,000 square feet while Moody's at the World Trade Center 7 is looking for 300,000 square feet and AON, and now in 1 freedom after 175,000 square feet-but everyone can renew it.
The brokers say that Water Street has always been a “valuable game” for desktop tenants, and there are currently many leasing deals suspended in the fifties and $ 60 for the foot.
Tenants like the city center a lot, often do not move to other parts of the city. S&P Global, a 350,000 square feet tenant in 55 Water St. Window shopping to the city center last year, but eventually decided to stay in place.
With the purchase of the established buildings for the conversion or its attachment, the tenants move elsewhere. This has led to many tenants from offices that exceed 100,000 square feet to negotiate a way out – it is paid – and search for new pits.
“They are pragmatists and take a surprise as part of the end of the rent and the entry of a very attractive market.” “There is not a lot of rental contracts have a demolition item, so most of them are one time negotiations with tenants.”
Therefore, these transfers cause “immediate positive absorption” as the remaining tenants are transferred, “Engelgherdat said:” They move and adhere to nearby assets that may have been struggling. But this is absorption from top to bottom. “
Vanbarton converts both 180 Water Street and 77 water, causing the ARUP Engineering to 99,418 square feet in a transition to 140 Broadway.
Among the buildings converted 111 million square feet and a part of less than 800,000 square feet of 80 pine has already been evacuated by AIG.
When the offices are rented by 50 % to 60 %, Spencer Levin said from Rale that the owners do not continue to rent because they believe that the grass may be more green on the other side.
“Everyone believes that their building can be transformed but in reality, it is just a small number.”
Brian Waterman from Newmark
But when it comes to selling it to an adapter, Levin said that there is still a “separation between the seller and their expectations.”
“Everyone believes that their building can be transformed but in reality, it is only a small number,” continued. “The amount of money needed to make it valid for living cannot be defended.”
He said most of the time, the building bases do not become “great living experiences.” He added that it is one thing that must be converted, and another to create a project that people want to live in.
To see more leasing speed in the city center, Brian Waterman said from Newmark that the rest of the market should be tightened.
“They go there out of necessity, not out of destitution,” Waterman explained.
But England was more optimistic. He said that the economic base in the city is very wide, “not every tenant is the arenas of Hudson or the Park Avenue tenant,” and those who are more sensitive to the price or are looking for economic treatment are looking in the city center“
