MANHATTAN OFFICE MARKET POSTS 8.4 MILLION SF OF LEASING IN THIRD QUARTER 2024

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NEW YORK CITY – The Manhattan office market posted 8.4 million square feet of leasing activity during third quarter 2024, bringing the year-to-date total to 21.7 million square feet, a 31% increase over the same period in 2023, according to research from Transwestern Real Estate Services (TRS). The quarter was also marked by the highest absorption levels in a decade, availability dropping to its lowest level in three years, and rent growth for the third straight quarter.

“This quarter’s strong leasing figure, particularly the year-to-date increase compared to last year, bears out the increased enthusiasm that has been noticeable in the market,” said Patrick Heeg, Partner, Transwestern. “We’ve been seeing leasing decisions being made faster, increased touring activity, and greater openness to longer terms. As tenants solidify their in-office work plans, they are in a much better position when entering lease negotiations.”

Additional notable results from the report include:

• Two dozen leases exceeding 50,000 square feet, including a dozen topping 100,000 square feet, were signed during the quarter.
• Most of the larger leases were renewals, many with an expansion component.
• Notable third quarter leases include Blackstone (1,019,100-square-foot renewal and expansion), Christie’s (373,000-square-foot renewal) and Willkie Farr & Gallagher (333,450-square-foot renewal), all in Midtown.
• Net absorption was a strong 5.7 million square feet, compared to negative 292,131 square feet last quarter, bringing year-to-date absorption into positive territory, at 2.7 million square feet.
• Overall availability decreased to 17.8%, its lowest point since 2021, with both direct and sublease availability contracting.
• Sublet availability is 18.8 million square feet, its lowest figure since late 2020.
• Asking average rents increased for a third consecutive quarter, hitting a four-year high of $76.55 per square foot.

“While this was not the outright strongest quarter since the 2020 shutdown, it clearly was among the top few, based strictly on the metrics,” said Corrie Slewett, Research Manager, Transwestern. “Quarterly leasing activity is heating up, availability is tightening and asking rents are up – all measures of a positive market.”

Slewett explained there was some softness behind a few of the numbers; for example, a significant portion of absorption came through withdrawals of several large blocks.

“As is usually the case, the next two quarters will clarify if 2024’s third-quarter performance marked the start of a positive trend,” she said.

Download the Q3 2024 Manhattan office report here.

About Transwestern Real Estate Services
Part of the Transwestern companies, Transwestern Real Estate Services (TRS) strives to add value for investors, owners, and occupiers across all commercial property types. Fueled by a holistic perspective of the real estate life cycle, agility and creativity are hallmarks of our approach, while vast national resources and sound market intelligence underpin customized recommendations and property solutions.

Four dynamic, integrated companies make up the Transwestern enterprise, giving us the perspective to think broadly, deeply and creatively about commercial real estate. Clients and investors rely on us for expertise that spans institutional and opportunistic investment, development, hospitality, and brokerage and asset services. Our award-winning, collaborative culture empowers team members with resources and independence to work across boundaries in pursuit of innovative solutions, reinforcing a reputation for service excellence that translates to measurable results. Through offices nationwide and alliance partners around the globe, we positively impact the built environment and our communities while fostering a work climate that champions career vitality for all. Learn more at transwestern.com and @Transwestern.

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