NEW YORK CITY—After a number of large lease deals pushed the city's tech sector to nearly 840,000 square feet in leases in May, the industry saw activity fall to 338,781 square feet in June, according to a research report released today by brokerage firm JLL.
Although total leasing activity was down in June as compared to a month earlier, the sector posted more leases (18) in June than in May (11). Only one deal in June totaled more than 50,000 square feet.
According to the report authored by JLL Research Analyst Tiffany Ramsay, despite the down month, the tech sector is playing a major role in the city's commercial real estate market. In fact, the tech sector has committed to more than 2.6 million square feet of space year-to-date, which is almost 15% of all leasing activity in Manhattan at the mid-year point of 2014. The tech sector is second only in market share to the perennial-leader—the financial services industry, which boasts a 22.5% share.
Although historically, the bulk of tech deals are inked at locations in Midtown South, in June 10 lease deals were signed in Midtown as compared to just four in Midtown South, the report states. The largest deal signed in June was Rocket Fuel's 90,000-square-foot lease at 100 W. 33rd St. Another deal of note in June was the 46,068-square-foot lease by Varonis Systems at 1250 Broadway.
Some other positive trends highlighted in the report for the tech sector include the city's high tech employment increased 5.8% year-over-year with the addition of 3,500 mew jobs—the largest growth rate of all employment sectors; and tech venture capital funding was up nearly 35% in June 2014 as compared to a year earlier.
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