ViewPoint Manhattan Office | 2018 Mid-Year Review - Extending the Cycle: Leasing Momentum Positions the Market for Continued Run
The Manhattan office market continued its robust run through mid-year 2018. At 15.36 million sq. ft., H1 2018 leasing activity reached its highest half-year total in over three years, reflecting solid leasing momentum that has been building consistently since the beginning of 2017.
The market continues to benefit from a healthy roster of large transactions, while smaller size segments have also rebounded from a slowdown in 2017.
The FIRE industries (financial services, insurance and real estate) accounted for the largest share of leasing activity during H1 2018.
Manhattan average asking rent fell to $72.20, a modest decline of 1% from year-end 2017 and roughly 2% from H1 2017.
Negative net absorption persisted in the market despite tremendous leasing, as much of the recent activity has gone to space with a long lead time prior to date of possession or that is outside the inventory of available space.
With the ongoing expansion of the New York City and national economies, and adequate blocks of space in the pipeline to facilitate future large lease transactions, there is reason to believe that robust demand will continue through the rest of the year.