
Trend Toward Short-Term Manhattan Lease Renewals is Losing Steam
The pandemic brought about a 46% increase of short-term renewals in the Manhattan office leasing market, CBRE reported. However, a research team led by senior director Nicole LaRusso wrote, this year a different story is unfolding. “As the pandemic is waning and restrictions are being lifted, occupiers are gaining clarity on future space needs and appear to be shifting away from short-term deals.”
Between April and December of 2020, 54% of renewals over 15,000 square feet had term lengths of five years or less, well above the ratio seen in prior years. These ranged in size up to the 340,000-square-foot renewal by NBCUniversal at 1221 Ave. of the Americas.
Year to date, though, the proportion of short-term renewals has already shrunk to 32%. Going forward, office landlords can expect “a bump of additional demand that will manifest most heavily between 2023 and 2026” as 2020’s short-term renewals expire.
- ◦Lease