Every year, the Metropolitan Transportation Authority ranks subway stops by annual ridership, and in 2015 the top five stations were all located in Midtown and Midtown South. So, that got me thinking about the performance of the surrounding office, retail and investment markets. Below are the top five ranked subway stops by annual ridership.
#5 34th Street-Penn Station (1, 2, 3) 28.3 million riders
and #3 34th Street-Herald Square 39.5 million riders
I combined these two subway stops since they are one block apart and service the same buildings in the surrounding area. This area has the lowest office vacancy rate at 6.7 percent, and despite limited available supply, it also has the lowest average asking rent at $59.94 per square foot. On the retail side, there are 43 stores available in the area totaling 189,933 square feet of ground-floor space. The average asking retail rent is $466.33 per square foot with a range from $80 to $1,290.
#4 14th Street-Union Square 35.3 million riders
The office market around Union Square is small in comparison with the other markets around high-trafficked subway stations, with only 7.1 million square feet of inventory. Its 7.1 percent vacancy rate is higher than Midtown South’s 6.5 percent, but the average asking rent is on par at $68.99 per square foot. Union Square retail is strong, with 15 vacant stores totaling 77,643 square feet. The average asking retail rent is $268.13 per square foot with a rental range of $175.00 to $550.00 per foot.
#2 Grand Central-42nd Street 46.7 million riders
The office market surrounding Grand Central Terminal is in the highest demand compared with the others. This year’s total leasing activity reached almost 4.3 million square feet—27.2 percent higher than the next closest area. Despite the high leasing activity, vacancy is the highest in this analysis at 9.8 percent, with asking rents averaging the second-highest at $71.34 per square foot. There are 41 stores vacant around Grand Central, totaling 223,129 square feet. The average asking retail rent is $357.57 per square foot and ranges between $100 and $1,250.
#1 Times Square-42nd Street 66.4 million riders
Not only does this subway station see the most riders pass through its turnstile; it also has the highest average office and retail asking rents and the highest investment dollar volume over the past 12 months. In the area around the Times Square station, six office buildings were sold totaling $2.8 billion—more than the other three areas combined. Office asking rents average $72.54 per square foot, while retail asking rents are $687.17 per square foot ranging between $85 and $2,500 a foot.
So, not only does the Times Square-42nd Street station have the most annual subway riders; it also has the priciest real estate of these top-ranked stations.