NEW YORK CITY- Manhattan office leasing has taken a tumble with leasing volume dropping by nearly 50 percent quarter-over-quarter. The slowdown in leasing activity is attributed to the stark drop in transactions during March when the coronavirus pandemic, also known as COVID-19, commenced, according to a recent Colliers International report documenting leasing activity for the first quarter of 2020.
For the first quarter of 2020, leasing was at 6.82 million square feet, 24.8 percent lower compared to the first quarter of 2019. Also, quarterly leasing activity was 26.3 percent below Manhattan’s five-year historical average of 9.25 million square feet and 18.9 percent below the 10-year average of 8.41 million square feet. While not uncommon to see a drop in quarterly leasing volume between the fourth and first quarters, this was Manhattan’s lowest first-quarter leasing total since 2013 and the lowest overall quarter of leasing since the third quarter of 2013, according to the report.
Manhattan’s financial services, insurance and real estate and TAM, short for technology, advertising, media and information services sectors, led the leasing by industry with a 34 percent and 27 percent share, respectively. Leasing by professional services companies followed at 21 percent. Approximately 12 percent of all FIRE tenant deals in the first quarter were leased by co-working companies, making up 4 percent of total leasing volume.