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Lower Manhattan

Lower Manhattan

Report: Higher Education Tenants Flocking to Lower Manhattan

Source: Alliance for Downtown New York

Leasing to post-secondary education tenants has increased by more than 80 percent since 2004 in Lower Manhattan, according to a January Lower Manhattan research report by the Alliance for Downtown New York. That is accompanied by a near doubling in student enrollment to about 50,000, all below Chambers Street.

Downtown Alliance Acting President William Bernstein attributes the 82 percent leasing increase downtown to the presence of the Borough of Manhattan Community College and Pace University as well as low rents and a healthy transit system. Read More

Lower Manhattan

Lower Manhattan’s Growing Pains

Illustration by Joel Kimmel.

Gleaming new skyscrapers are rising, and more are planned. A cavernous retail complex that was once the highest-grossing shopping mall in the country is being reborn. The biggest and boldest investment in grand transit infrastructure in a generation is winding its way toward completion.

There’s no doubt that Lower Manhattan, with its blooming residential population, is not the office district it was a decade ago. During the recession, while other areas of the city like Midtown were wilting as tenants cast space onto the market and leasing activity plunged, the area, which experts were initially concerned would suffer the worst of the downturn, unexpectedly held its own.

Downtown’s sparkling newness, combined with its economy—space there comes at a substantial discount to Midtown North and South—has already drawn big tenants who believe it will be the city’s commercial district of the future.

Last year, Condé Nast signed a lease in excess of 1 million square feet at 1 World Trade Center, a deal that was perhaps even more beneficial to lower Manhattan than all its construction projects combined, thanks to what analysts describe as the company’s ability transform the area’s staid image. As exciting as all the progress is, lower Manhattan success stories, as they often do, come with caveats. Read More

Lower Manhattan

These Days, Tenants Housed in Insurance Submarket Anything But

Insurance submarket.

Since emerging in the early 20th century, the Insurance District has taken over the northern streets of the Financial District. The district spans from Broadway to William Street and from Pine Street to Park Row, with John and Fulton streets forming the heart of the district.

The New York Life Insurance Company, among the largest insurance companies today, was founded in 1845 and opened its first headquarters at 112-114 Broadway, becoming one of the first insurance companies in the area. Hundreds of firms moved to the area and took spaces in historic buildings like the Home Royal Insurance Building, 110 Fulton Street, Home Insurance Plaza and the National Board of Fire Underwriters Building. Read More

Lower Manhattan

Sale of City Hall Buildings Snagged

City Hall submarket.

A city proposal to sell three lower Manhattan buildings, potentially converting 750,000 square feet of outmoded office space into luxury housing or hotels, has run into objections from community representatives in the City Hall area, who argue that the plan should have included provisions for a school, community center or affordable housing.

The City Council’s subcommittee on planning, dispositions and concessions plans a hearing next week on the disposal of the properties at 22 Reade Street and 49-51 Chambers Street. Disposition of the third building in the package, at 346 Broadway, was approved in 1998. Mayor Michael Bloomberg announced the sale in January as part of a drive to make the city more efficient by consolidating its office spaces. Read More

Lower Manhattan

Financial West Submarket Still Waiting, Waiting, Waiting for Market Boost

Financial West submarket.

An improved transportation hub at South Ferry and the overhaul of Battery Park have yet to translate into gains for the Financial West office market.

The area west of Broadway and South Street and south of Albany and Liberty Streets had the lowest average rent and highest vacancy rate among downtown submarkets in the third quarter, according to Cushman & Wakefield. Read More

Lower Manhattan

New Breed of Creative Class Tenant Heads to Financial East Submarket

Financial East submarket.

Silverstein Properties this month leased a 50,000-square-foot block of space at 120 Broadway to Beyer Blinder Belle Architects & Planners LLP, taking advantage of the incipient migration of a new breed of tenant into the Financial East area.

The prewar buildings that predominate in the submarket, which includes the financial landmarks along Broad and Wall Streets, have long since ceased attracting the biggest banks, law firms and insurers. Still, while vacancies in the submarket remain at almost 14 percent, local landlords and brokers say the flow of nontraditional tenants into the area is beginning to gain momentum. Read More

Lower Manhattan

In World Financial Submarket, Silverstein, Brookfield Rule the Roost

World Financial submarket.

The 1 World Trade Center tower, which seems to spring into view from every vantage point these days, symbolizes different things to different people. To commercial landlords and brokers, it represents both a flagship for the Downtown area and a potential surge in competition. For those with a direct stake, it means the recovery from the terrorist attack is finally reaching the finish line.

“The sense of momentum and progress, which was not universal for years, is now palpable,” said Janno Lieber, who oversees design and construction at the site for Silverstein Properties, the landlord of the two towers that were destroyed 11 years ago. Read More

Lower Manhattan

Downtown Manhattan on the Up and Up

Downtown Manhattan.

For much of the past decade the only hope for a broker looking to make money off of Downtown office space was to do a deal like 70 Pine Street: Take a lavish 62-story Art Deco headquarters that was once owned by a spectacularly failed financial firm like AIG and turn it into opulent apartments where bankers would rather live than work.

Deals like 70 Pine Street, which instantly wiped off one million square feet from Downtown’s commercial real estate inventory when it was sold for $200 million in 2011, have been propping up statistics for the neighborhood’s office space market for years. Ever since large banks and financial companies started fleeing offices in the financial district, an influx of young families and bankers wanting to live Downtown, rather than just work there, have kept the vacancy rate from tanking even further by reducing the math on the supply end.

Now, say the brokers who have long suffered the horrors of Downtown’s commercial market, those residential conversions are starting to also pay off on the demand side. A flurry of infrastructure and amenities building to keep up with the new residents in the neighborhood is also making the area more enticing for large corporations to move in.

“It’s a chicken-and-egg scenario,” said Mark Shapses, executive managing director at Studley. “Downtown is seeing the light at the end of the tunnel.” Read More