Press Release

CBRE Issues Q4 2017 New York City MarketViews

1월 11, 2018

NEW YORK, NY (January 11, 2018) – Manhattan leasing activity totaled 7.35 million sq. ft. in the fourth quarter (Q4) of 2017, 10% above its five-year quarterly average, bringing annual leasing activity to 28.43 million sq. ft. at year-end, a 24% increase from 2016’s total. The quarterly Manhattan availability rate was 11.5%, down 20 basis points (bps) from Q3 2017, but unchanged from a year ago. Quarterly net absorption registered 750,000 sq. ft., bringing the year-end total to negative 544,000 sq. ft. The average asking rent, at $72.91 per sq. ft., declined 1% quarter-over-quarter, but was virtually unchanged from a year ago. Sublease availability currently stands at 2.3%, down 10 bps from Q3 2017, but up 20 bps year-over-year.

“The fourth quarter capped off a strong year for the Manhattan office market,” said Nicole LaRusso, Director, Research & Analysis, CBRE Tri-State. “A robust economy supported business expansion and gave a boost to leasing activity. Average rents and the availability rate held steady for Manhattan overall, though availability might tick up as more space comes to market this year. With the stimulus provided by the new federal tax law, we may see a boost to corporate demand for space that would prolong economic expansion.”

Among the MarketView highlights:

Midtown – The year just ended will be remembered as one of the strongest for the Midtown office market. Year-end leasing activity totaled 17.97 million sq. ft., marking Midtown’s highest output in over a decade. In the fourth quarter alone, the market totaled 4.86 million sq. ft. of leasing activity, its greatest amount of quarterly leasing activity since Q2 2015.

Exceptionally strong leasing numbers were driven in large part by leasing activity in the 50,000 sq. ft. or larger segment, which accounted for 41% of Midtown’s year-end total.

CBRE Press Release

This caused availability to fall to 11.2%—its lowest quarterly level since Q4 2015. The average asking rent fell by 1% year-over-year to $79.19 per sq. ft., due in part to strong leasing in higher-priced, large-block buildings. Although these large relocations will create future vacancies, the impact will be spread over several years and will not significantly impact availability in the upcoming year.

Midtown South – Midtown South’s market fundamentals broadly improved in 2017 versus the prior year, even amid the market headwind of limited supply. Despite just two large block deals, leasing activity in 2017 saw a 13% jump from the prior year, with the familiar trend of smaller transactions driving this market.

Last year also saw the emergence of a new trend in Midtown South: a more diversified tenant base than in years past. For the first time since 2012, the Tech, Advertising, Media and Information (TAMI) sector accounted for less than 50% of the total leasing activity, while the Finance, Insurance and Real Estate (FIRE) sector saw its proportion nearly double to 34% from the prior year.

Downtown – It was a very good year for the Downtown market, with 5.48 million sq. ft. of leasing activity by the close of 2017, thanks in large part to the completion of several large deals. Unlike 2016, where only three transactions closed over 100,000 sq. ft., nine such deals closed in 2017. Large tenants across various industries—government, tech, and financial firms—have chosen to make long-term commitments to the Downtown market over the past 12 months.

Availability and asking rents both increased significantly in the past year, with new construction playing a key part in both changes. The addition of 1.8 million sq. ft. of space at 3 World Trade Center helped drive availability up 120 bps since 2016 to 13.5%, and asking rents up 6% year-over-year to $61.85 per sq. ft. Downtown continues to provide quality options for large users, in both existing office product and new construction. Market conditions, as a result of the increased availability and competitive pricing, ensure that Downtown will continue to be an attractive option for sizable tenants in the market. 

About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company headquartered in Dallas, is the world’s largest commercial real estate services and investment firm (based on 2021 revenue). The company has more than 105,000 employees (excluding Turner & Townsend employees) serving clients in more than 100 countries. CBRE serves a diverse range of clients with an integrated suite of services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at