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Leasing activity climbs 25.2% in first half of 2022 while sublease offerings increase overall availability to 18.6%
July 5, 2022
Avison Young releases second quarter 2022 Manhattan Office Insights Report
New York, NY – Avison Young today released its Second Quarter 2022 Office Insights Report for New York. Overall leasing activity reached 14.9 million square feet (msf) in the first half of 2022, a 25.2% increase from a year ago, although volume lagged the 20.2 msf historical average for January-June in the decade preceding the pandemic.
“While Manhattan office leasing demand has risen and virus-related health concerns have subsided in recent months, the market continues to encounter substantial pandemic-related repercussions,” said Mitti Liebersohn, Avison Young President and Managing Director of the firm’s New York City Operations. “The quarterly data confirms that the market remains burdened by direct and, increasingly, sublet availabilities, giving tenants leverage in many circumstances.” The 73.6 msf of offices available directly from landlords, at 14.1%, represented a contraction of 20 basis points from the first quarter, but sublease availability increased to 23.4 msf or 4.5%, up 30 basis points from the first quarter. That nudged total availability to a new high of 18.6%, up from 18.5% in the first quarter.
The top 10% of the market captured 30.9% of leases in the first half of the year. Trophy net rents have increased 13.1% to average $103.30 per square foot since March 2020. By contrast, near-record levels of concessions have reduced Class A effective rents by 7.2% in the same period as those landlords compete with trophy buildings.
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