Tag Archives: quarter three

What’s going on in New York City?

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TAMI leasing activity surges… and other Q3 insights from NYC

NYCIn our latest report, New York Office Insight, JLL highlights some of the more interesting trends we are seeing take shape across the New York office market, with specific emphasis on happenings as seen at the end of the third quarter.

New leases drive YTD activity
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New York office market posts lowest overall vacancy rate since Q3 2008

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  • Vacancy rates down in all submarkets, building classes
  • Overall Manhattan rents continue to rise in 3rd quarter of 2014

NYC_blogDespite moderate leasing activity during the third quarter of 2014, New York’s office market posted sharp drops in vacancy rates in every submarket and property type, according to JLL. The city’s overall vacancy rate has fallen to its lowest level since the third quarter of 2008.

Manhattan’s overall vacancy rate dropped to 9.7 percent this quarter, a decrease of 8.5 percent (or 0.9 percentage points) from 10.6 percent at midyear 2014. The city’s Class A vacancy rate fell to 10.6 percent in the third quarter of 2014, a decrease of 7.8 percent (or 0.9 percentage points) from 11.5 percent the previous quarter.

“The final quarter of the year is typically the most active in Manhattan, and brokers reported brisk building touring activity over the summer,” said Tristan Ashby, director of New York research.

“Going forward, we expect to see much higher rents throughout the city as vacancy rates continue to tighten. There are increasingly fewer opportunities at the very top end (Plaza Trophy) and very low end (Downtown Class B) of the market, or anywhere in Midtown South. Longer-term, large blocks will begin entering the market in Midtown beginning in 2018 as new construction, redevelopments and several large blocks vacated by relocating tenants come online.”

Overall average asking rents in New York rose to $64.91 per square foot this quarter, an increase of less than one percent from $64.57 per square foot at midyear 2014. The city’s Class A average asking rent grew to $71.66 per square foot in the third quarter of 2014, an increase of less than one percent from $71.28 per square foot the previous quarter.

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