Manhattan Office Posts Best Quarter in Two Years

Manhattan office leasing finished 2021 strong, according to fourth-quarter reports from Newmark and Colliers. Newmark said the Q4 total was 29.8% above the quarterly average since the pandemic began, while Colliers’ tally of 8.63 million square feet represented Manhattan’s strongest quarter since late 2019. 

Full-year leasing volume (24.96 million square feet) also rose by 31.6% since the prior year, the strongest yearly growth since 2013. However, Manhattan’s 2021 leasing volume was still 41.9% below the pre-pandemic leasing volume in 2019. 

“The fourth quarter provided key indicators of the Manhattan office market’s resolve,” said Franklin Wallach, senior managing director of Research | New York at Colliers. “Demand was the strongest in two years, sublet supply tightened for the third consecutive quarter and the asking rent average surpassed pre-pandemic levels in pockets of the market. However, opportunities for tenants still exist with nearly 40 million square feet of added supply since March 2020 hampering the recovery.” 

That new inventory also bolstered asking rents, Newmark said. The average rose 4.6% during Q4 to $76.86 per square foot.