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Office leasing usually sees an uptick in growth during this time of year, but a new report shows that Manhattan’s activity has fallen to its lowest level since April of 2021.
According to new data from Colliers, office leasing activity fell 7% from October and 50% from November 2021, indicating cooling demand.
“The available supply increased with blocks of sublet space, new construction/major renovation and soon-to-be vacant blocks of space continuing to enter the market, leading to record-high availability in Midtown South and Downtown,” said Franklin Wallach, executive managing director at Colliers.
Coworking firm Jay Suites signed the largest deal of the month, albeit on the lower end of averages, for a 60,000 square foot location on West 25th Street.
The slowdown comes at a time when tech firms, among some of the largest tenants in Manhattan, are pulling back on their office space to moderate expenses. For instance, Meta recently declined to renew leases on two properties that are set to expire in 2024.
According to Wallach, new construction will continue to come onto the market and widen the gap between demand and availability.
“More new construction/major renovations are scheduled for delivery in the coming quarters along with millions of square feet of upcoming vacancies due to committed tenant relocations,” said Wallach.
