The New York commercial real estate market has undergone an impressive recovery since a devastating collapse in 2008. Since 2009, in fact, the city’s office employment numbers are up 9.5 percent and occupancy rates are up 3.3 percent. Meanwhile, overall asking rents are up 20.7 percent from 2010. Occupancy trends are changing from their precrash levels, however.
Despite growth in office jobs to 1.26 million in 2013 from 1.21 million in 2006, occupancy levels are down to 89 percent from 93 percent over the same period. Those numbers reflect changes in office environments and working styles that will continue to impact occupancy for the foreseeable future, according to Richard Bernstein, an executive vice chairman at Cassidy Turley, during the firm’s annual State of Real Estate market meeting last week in a presentation entitled “Staying Ahead of the Delta.
“They will write Don Draper out of the show by making him work remotely,” joked Mr. Bernstein, conflating the 1960s era television show Mad Men with recent occupancy trends.
Office and retail sales trended differently in 2012, added Noble Carpenter, head of capital markets at Cassidy Turley. Retail experienced strong growth last year, with investment sales transactions doubling in 2012 across Midtown, Midtown South and Downtown. While the number of office sales increased, the average size of transactions dropped 52 percent in the same markets.
After the jump, a selection of data points from the event.