Although New York’s office supply has skyrocketed in the past few years, demand has also risen and caused rent prices to inflate.

According to Colliers International, over 9 million square feet of office space was leased in the first quarter of 2019, while rents reached a record of about $77 per square foot.

Coworking providers in particular are one of the key factors behind this growth, as well as a growing economy. For example, New York-based operator Knotel added seven new locations in the first three months of the year, while WeWork leased 200,000 square feet.

“Manhattan is becoming a larger market in terms of availability. Tenants are taking less space each quarter, per employee,” said Craig Caggiano, Colliers New York Tri-State Executive Director. “When you think about that it is quite extraordinary … The fact that we are adding more and tenants are taking less, you think you would see a lot more availability.”

While some are concerned about the city’s dependence on coworking and how it could turn out in the face of economic downturn, Savills Senior Managing Director Gabe Marans said that worst-case scenario, landlords would still have access to built-out spaces and be able to release them to tenants.