The euphoria of a fourth-quarter surge in office leasing in Manhattan at the end of 2023—which was fueled by a bevy of mega-leases—has given way to the hangover of a 23% drop in leasing activity in the first quarter of 2024.

Office leasing volume in Manhattan retreated to 6.8M SF in Q1, down from the hefty 8.9M SF reported in the previous quarter. The first quarter tally also is 6.6% lower in a year-over-year comparison with Q1 2023, according to a new market report from Savills.

The cooling leasing climate, which Savills called "tepid," coupled with "abundant large block additions," drove the overall office availability rate in Manhattan to a new post-pandemic peak of 20.1%, rising by 2.9M SF in the first quarter to a new total of 94.1M SF.

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