Leasing activity in the Manhattan office market ended 2015 with a 13-percent dip from the previous year. According to a research from Newmark Grubb Knight Frank, the slump was due to sluggish years in Midtown South and Downtown. At the end of the year, the asking rent in Manhattan submarkets ranged from $60 to $62 per square foot.
Data from Newmark's fourth quarter office report showed that last year, the Manhattan office market came 5.4 million square feet short compared to its 2014 total. In 2015, landlords leased or renewed only 36.2 million square feet of office space.
While 2015 was Midtown's busiest year since 2013, the borough's two other office submarkets struggled. With 13 million square feet worth of transactions, activity in Midtown South was down by 20.7 percent from last year's decade-high of 16.4 million square feet. Additionally, Midtown South's availability dropped to an 8-year low of 7.7 percent at the end of the year because no major space was added to the office market. The asking rent in the submarket averaged at $69.51 per square foot.
Google's 250,000-square-foot lease at RXR Realty and Young Woo & Associates' SuperPier marked Midtown South's largest deal of the fourth quarter. The lease was also the only one to break the 100,000 square feet mark.
Meanwhile, Downtown finished strong in 2015 by closing major deals like the Teachers' Retirement System of New York's lease renewal and expansion to 200,000 square feet at the 55 Water Street, and the Associated Press' relocation to 170,000 square feet at 200 Liberty Street.
However, due to a slow start at the first quarter of the year, the Downtown submarket ended 2015 with its lowest yearly total in the past five years, only 5 million square feet of activity. Availability rate held stable throughout the year ending at 12.7 percent in the fourth quarter. The asking rent in the submarket averaged at $60.90 per square foot.
