Lower Manhattan Records Strongest Quarter of Leasing Activity in Seven Years
Lower Manhattan recorded its strongest quarter of commercial leasing activity in seven years and outpaced the five-year quarterly average in Q2, according to the Alliance for Downtown New York's Q2 2018 Lower Manhattan Real Estate Market Report.
Activity was largely driven by new leases at 3 World Trade Center and Brookfield Place. J.Crew signed the largest deal of the quarter at Brookfield Place and McKinsey & Company executed the quarter’s second largest deal at 3 World Trade. J.Crew's move to Lower Manhattan further deepens the local fashion community which already includes Hudson’s Bay, also headquartered at Brookfield Place, Hugo Boss, Gucci, MM.LaFleur, Bottega Veneta and more.
"The opening of 3 World Trade Center marked a major milestone for Lower Manhattan. In addition to bringing new companies and jobs to the neighborhood, we're thrilled to see how the entire WTC campus opening up and integrating seamlessly into the local community," said Downtown Alliance President Jessica Lappin.
While mitigated by strong leasing activity, the second quarter witnessed Lower Manhattan’s overall vacancy rate rise, as expected, to above 11 percent for the first time since the first quarter of 2014. The jump was due to the addition of 3 World Trade Center, which brought 1.6M square feet of available Class A space to the market and pushed the overall average asking rent to $62.90 per square foot, the highest in the market’s history.
Finally, the report illustrated how private sector employment remained at its highest level since September 11, 2001 (242,593 employees) and that the Seaport District is full steam ahead for a busy 2018 with a number of its shops and eateries opening this summer and fall.