Sixth Avenue to Run Red with Vacancies
Leasing has been off pace in the first half of the year and the slowdown hasn’t played out at the city’s fringes.
Sixth Avenue, one of the Midtown’s central corridors that is often referred to as Corporate Row because of the large, regal office buildings there and the avenue’s roster of Fortune 500 companies, appears poised to become flush with vacancies.
Last year, the large French financial company Societe Generale reached a deal to relocate from more than 400,000 square feet at 1221 Avenue of the Americas to 245 Park Avenue. Just next door, at 1271 Avenue of the Americas, Time Inc., which occupies the bulk of that two million square foot tower, is considering options to relocate to other locations, including the West Side rail yards.
Microsoft, a tenant with more than 200,000 square feet at nearby 1290 Avenue of the Americas, meanwhile is also rumored to be considering a move off of the avenue, to other locations in Midtown or Midtown South. 1177 Avenue of the Americas has a block of floor available as well in its base that brokers familiar with the property said totals 100,000 square feet or more.
And the hits keep coming.
Dewey Laboeuf, the large law firm that just imploded, will cast on nearly 500,000 square feet at 1301 Avenue of the Americas. Add that to the 60,000 square feet being shed in the same building by Grubb & Ellis, the real estate services firm that went bankrupt in recent months. UBS is also said to be considering dropping hundreds of thousands of square feet it is considering at 1285 Avenue of the Americas.
“I think that Sixth Avenue is looking at a lot of vacancy,” one broker who works on the Avenue told The Commercial Observer. “We had a tenant who is up to their third tour of space. There is so much vacancy, it’s taken them three separate tours to see it all.”