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Manhattan Sublease Space Supply Begins Ebbing
After seeing sublease space continuously increase during the pandemic, the Manhattan office market is finally seeing a slowdown in space being put on the market, Savills research director Danny Mangru reports. During the second quarter, Manhattan sublease supply dipped by 0.7 million square feet and now totals 21.3 million square feet, or about 24.7% of total available space.
Mangru reports that more than 50% of mid-size tenants – spaces above 20,000 square feet – have either re-occupied or backfilled their space rather than subletting them. Additionally, 25% of office spaces larger than 20,000 square feet have already been sublet.
The asking rent spread between direct ($80.51) and sublease ($59.16) space widened to 26.5% during Q2, writes Mangru. He adds, though, that while sublease supply has contracted, more space is likely to become available, albeit at a modest pace, as many organizations try balancing new, hybrid workforce strategies with long-term space needs.
- ◦Lease
