New York office market report
Q3 2024
Through Q3 2024, Manhattan leasing activity has reached 23.1 million square feet (msf) of leasing activity – a 25.1% increase over this time last year – and like earlier in the year, has been mostly driven by large block leasing. The overall availability rate dropped 90 basis points (bps) quarter-over-quarter to 18.7% - marking the first quarter of sub-19% availability since Q1 2021. Additionally, office buildings across Manhattan are on average 73.4% as busy as they were in August 2019 – well above the U.S. average of 60.4%.
Manhattan leasing activity YTD 2024 is significantly ahead of Q1-Q3 2023
Year-to-date 2024 leasing activity in Manhattan has reached 23.1 million square feet (msf) – placing leasing activity 25.1% above this time last year.
The number of 100k+sf transactions through Q3 also increased from 2023 to 2024 -jumping from 18 transactions to 25. This increase in large-block leasing activity has strongly contributed to 2024’s leasing activity significantly outpacing 2023.
Manhattan availability rate dropped below 19% for the first time since Q1 2021
Manhattan’s overall availability rate of 18.7% in Q3 2024 marks the first quarter of sub-19% availability since Q1 2021. Quarter-over-quarter, the overall availability rate dropped by 90 basis points (bps) from 19.6%. This drop was mostly led by a 4.3 msf decrease in direct available space from last quarter, while sublease only decreased by ~400,000-sf.
This decrease in available office space in just one quarter, combined with the elevated year-to-date leasing activity, demonstrates the current strength of the Manhattan office leasing market.
Manhattan office busyness, August 2024 vs. August 2019
As of August 2024, office buildings in Manhattan are 73.4% as busy as they were in August 2019. This figure sits well above the overall U.S. office busyness level at 60.4%. Much of Manhattan’s office strength can be attributed to banking/finance and government tenants that have been the foundation of the Manhattan office market for decades.
Midtown Manhattan has seen the strongest growth in year-over-year office busyness. Midtown West and Central Park have seen +21.3% and +12.7% year-over-year increases, respectively.
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