NAR continues to believe that offers of compensation are an important option to help make professional representation more accessible.
Starting out in her 20s, Rondon worked with real estate legend Faith Hope Consolo while at Garrick Aug Associates, where she spent 13 years.
“The worst of the downturn in home sales could be over, with increasing inventory leading to more transactions,” said NAR Chief Economist Lawrence Yun.
Leasing activity totaling 6.38 million square feet in the fourth quarter was 20% ahead of the five-year quarterly average of 5.34 million square feet.
NEW YORK—Manhattan’s office leasing had a modest rebound during the fourth quarter of 2023, according to CBRE’s Manhattan Q4 Figures report released on Jan. 9. Leasing activity totaling 6.38 million square feet in the fourth quarter was 20% ahead of the five-year quarterly average of 5.34 million square feet.
Despite improved leasing, the availability rate of 20.0% was up 20 basis points from the previous quarter and up 80 basis points from a year ago. Net absorption was negative 708,000 square feet in the fourth quarter, bringing the year-to-date total to negative 3.13 million square feet. At $76.83 per-square-foot, the average asking rent was flat compared with the third quarter. Renewals tallied another 2.63 million square feet in the fourth quarter that helped the year-to-date total hit 7.07 million square feet. The sublease availability rate of 4.9% remained relatively flat from the third quarter of 2023.
The high end was the Manhattan market's strength in 2023. The 128 transactions at $100+ per-square-foot closed in 2023 was the second-highest annual total ever—35% above the 10-year average and only 10% behind 2022’s record-setting figure of 142 deals. Transactions at $200+ per-square-foot also achieved the second-best all-time total with 10 deals in 2023, demonstrating that the highest reaches of Manhattan’s office market remain on the rise.
“Top-quality, well-located assets were in high demand throughout 2023—a trend that will persist in 2024 and expand into the next tier of quality assets as top-tier supply dwindles,” said Michael Slattery, CBRE’s Director of Tri-State Research. “The dearth of office construction in the near-term will reinforce leasing among existing assets.”
The Midtown office market has started to separate itself from the rest of the market in terms of recovery. The availability rate has flattened, there is less sublease space than at year-end 2022, and meaningful declines in supply can be seen in certain pockets, particularly the Park Avenue submarket, where the availability rate is 9.4%. Moreover, supply in better buildings within Midtown’s core (Grand Central, Park, Madison, Plaza, Sixth/Rock) has declined 290 bps over the past 20 months and now sits at 11.5%.
During the fourth quarter, leasing activity in Midtown totaled 4.27 million square feet, 29% ahead of the five-year quarterly average of 3.30 million square feet. As a result, the availability rate was down 10 bps from last quarter at 18.0% and down 30 bps from the same time last year. Midtown saw the nation's largest relocation of 2023 with law firm Paul, Weiss, Rifkind, Wharton & Garrison taking 765,000 square feet at 1345 Avenue of the Americas. Another indicator of recovery was Midtown’s net absorption, which was positive 180,000 square feet in the fourth quarter, and positive 509,000 square feet for the year. At $82.89 per-square-foot, the average asking rent was flat both quarter-over-quarter and year-over-year in Midtown.
The Midtown South market also showed some positive signs in the fourth quarter with leasing activity of 1.53 million square feet, significantly ahead of the third quarter and the five-year quarterly average of 1.12 million square feet. Year-to-date leasing activity totaled 3.9 million square feet, down 26% from the same time last year. Renewals totaled 448,000 square feet. in the fourth quarter, bringing the year-to-date total to 1.04 million square feet. The availability rate was up 80 bps from last quarter at 22.5% and up 330 bps from a year ago. Net absorption was negative 681,000 square feet in the fourth quarter, bringing the year-to-date total to negative 3.12 million square feet. At $83.35 per-square-foot, the average asking rent climbed 2% quarter-over-quarter but was flat year-over-year.
After showing some improvement at the beginning of year, the Downtown market was lackluster during the fourth quarter of 2023. Leasing activity dropped to 589,000 square feet in the fourth quarter, 36% behind the five-year quarterly average of 915,000 square feet Year-to-date leasing activity of 2.84 million square feet was down 9% from the same time last year. Renewals totaled 626,000 square feet in the fourth quarter, bringing the year-to-date total to 1.61 million square feet The availability rate was up 20 bps from last quarter at 23% and was up 110 bps from the same time last year. Net absorption was negative 207,000 square feet in the fourth quarter of the year, bringing the year-to-date total to negative 516,000 square feet. At $57.21 per-square-foot, the average asking rent was virtually unchanged during the fourth quarter of 2023 and 2% lower year-over-year.
NAR continues to believe that offers of compensation are an important option to help make professional representation more accessible.
Starting out in her 20s, Rondon worked with real estate legend Faith Hope Consolo while at Garrick Aug Associates, where she spent 13 years.
“The worst of the downturn in home sales could be over, with increasing inventory leading to more transactions,” said NAR Chief Economist Lawrence Yun.
The hirings mark RM Friedland’s continued expansion into Fairfield County by hiring two true market specialists who are deeply rooted in Fairfield County’s business network.
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