Tech Continues to Disrupt Midtown South: Report



Ashkán Zandieh announced the release today of a Midtown South market metrics report that expands on the disruptive force of the New York start-up scene on the city’s commercial real estate industry.

“From co-working spaces to subleases,” Mr. Zandieh writes, “start-ups and creative entrepreneurs alike have altered the traditional real estate industry.”

Ashkán Zandieh
Ashkán Zandieh

When The Commercial Observer spoke with Mr. Zandieh, the director of the creative and start-up advisory division at ABS Partners Real Estate, earlier this year, he told us that “for every high there’s a low. It’s inevitable. The market will mature. It might not dip, but it will stabilize.”

His latest reports backs that prediction up. The average asking rent for a 1,000-5,000-square-foot direct lease in the submarket was $49.73 a square foot in the second quarter of this year. That’s a slight dip from the first quarter’s $49.88 asking rent and just ahead of the fourth quarter of 2012’s $49.21 figure.

Meanwhile, the sublease market for spaces between 1,000 and 5,000 square feet saw a 5.72% year-to-year increase, to $42.53 from $40.23. Mr. Zandieh points out that to date 35% of new leases for start-ups have been subleases.