Leasing Volume in Manhattan Hits Pandemic High in July

Leasing Volume in Manhattan Hits Pandemic High in July
Downtown Manhattan's skyline is seen in New York City on Aug. 21, 2021. (Andrew Kelly/Reuters)

NEW YORK—Leasing volume for Manhattan office space reached a pandemic-era high in July, good news for the hard-hit New York office market, though the amount of space leased was still 11.6 percent less than the pre-pandemic average in 2019, data showed on Monday.

Leasing activity in Manhattan, the premier U.S. office market, jumped 43 percent from June and 35 percent from July 2021 to 3.16 million square feet, brokerage Colliers International Group Inc. said in a report.

In other welcome signs for a market still suffering from the pandemic and the rise of remote work, the availability rate for office space tightened 0.2 percentage points to 17 percent, while absorption was a positive 1.09 million square feet.

Positive absorption indicates that more space was leased than was newly built or put on the market through sublets. Manhattan has been in a construction boom over the past decade, boosting the amount of Class A space to the detriment of lesser-quality offices.

Availability has grown by 70 percent to 91.7 million square feet in Manhattan since COVID-19 was declared a pandemic in March 2020, Colliers said.

Asking rents slid to $75.43 a square foot last month from $75.61 a square foot in June, but was up from $72.72 a year ago.

Key data on tenant improvement allowances and how that reduces the effective rent was not immediately available.