NEW YORK CITY—While there's been a softening in commercial real estate activity citywide—and Lower Manhattan is no exception to that trend—the submarket was the only such section of Manhattan to post a year-over-year reduction in its commercial vacancy rate in the third quarter, according to a new report from the Alliance for Downtown New York.
The report shows that although transaction velocity Downtown slipped by 15% from last year's pace, the area fared better than Midtown and Midtown South, which were down 20% and 29%, respectively. Lower Manhattan may have fared better in its pace of activity than Manhattan's two other submarkets because so far this year, more than half of Lower Manhattan's 20 largest transactions represented companies who either expanded or relocated within the neighborhood.
The neighborhood was also the only Manhattan submarket to post a year-over-year drop in commercial vacancies, with a rate of 9.9%, and maintained stable overall asking rents of approximately $60 per square foot.
“We've had a steady drum beat of commercial activity over the past few months in Lower Manhattan,” says Jessica Lappin, president of the Alliance for Downtown New York. “Saks, Target, Eataly, the shops at Westfield, The Beekman and The Four Seasons, all opened this quarter to much fanfare. Things are changing quickly and Downtown is growing as a top destination for New Yorkers and tourists alike, It's clear to see why our current tenants are doubling down on the neighborhood.”
New openings across Lower Manhattan in the third quarter included 102 new stores and restaurants, two hotel properties and four residential buildings. The opening of Westfield World Trade Center kick started the activity in August and was followed by the opening of Saks Fifth Avenue, Warby Parker and Starbucks Reserve Bar in Brookfield Place; iPic Theatres and The Tuck Room in the Seaport District; and Target's first flexible format store in Manhattan.
Luxury hotels The Beekman and The Four Seasons Hotel New York Downtown both opened mixed use properties that together added 476 new hotel rooms, 225 condos and three restaurants from high-profile chefs Wolfgang Puck, Tom Colicchio and Keith McNally. In addition, the residential market saw the addition of 166 units at 100 Barclay St. and 6 units at 246 Front St. in the Seaport District.
The report shows that although transaction velocity Downtown slipped by 15% from last year's pace, the area fared better than Midtown and Midtown South, which were down 20% and 29%, respectively. Lower Manhattan may have fared better in its pace of activity than Manhattan's two other submarkets because so far this year, more than half of Lower Manhattan's 20 largest transactions represented companies who either expanded or relocated within the neighborhood.
The neighborhood was also the only Manhattan submarket to post a year-over-year drop in commercial vacancies, with a rate of 9.9%, and maintained stable overall asking rents of approximately $60 per square foot.
“We've had a steady drum beat of commercial activity over the past few months in Lower Manhattan,” says Jessica Lappin, president of the Alliance for Downtown
New openings across Lower Manhattan in the third quarter included 102 new stores and restaurants, two hotel properties and four residential buildings. The opening of Westfield World Trade Center kick started the activity in August and was followed by the opening of Saks Fifth Avenue, Warby Parker and Starbucks Reserve Bar in Brookfield Place; iPic Theatres and The Tuck Room in the Seaport District; and
Luxury hotels The Beekman and The Four Seasons Hotel
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