Stat of the Week: Downtown’s Five Submarket
By Richard Persichetti October 27, 2016 4:45 pmreprints
Downtown was the only market in Manhattan that had a year-over-year decline in vacancy through the third quarter, dropping 40 basis points to 9.9 percent. So, let’s further examine this victory over Midtown and Midtown South by focusing on the top five statistical changes by submarket for Downtown.
Highest Percentage of TAMI Leasing – Downtown’s new leasing activity for tenants’ which took more than 10,000 square feet has been dominated by the TAMI industry this year, accounting for 29.8 percent of the activity and totaling 627,723 square feet. The Financial West submarket had the highest percentage of TAMI activity of the five submarkets, with 66.1 percent of the square footage leased within this industry.
Asking Rent Increase – Insurance Class A asking rents jumped 24.7 percent over the last 12 months, the third-highest of the 19 Manhattan submarkets. Class A rents are up from $48.83 per square foot to $60.88 per square foot.
Highest Office Investment Volume – Almost half of the office buildings sold Downtown were in the City Hall submarket. The 11 properties sold totaled over $1.9 billion in volume. Financial East was the next closest submarket with five buildings traded, totaling $1.3 billion.
Highest Total Leasing Activity – With over 2.3 million square feet leased or renewed, the Financial East submarket takes the top spot for both total leasing activity and as a percentage of the submarket’s inventory, as 6.6 percent of the market was transacted. Financial East also had the most midsized deals—25,000 to 75,000 square feet—completed, with 13 totaling over 491,000 square feet.
Year-Over-Year Vacancy Decline – The World Trade submarket had little competition in this category with a 400-basis-point drop to 13.1 percent. Class A vacancy still remains high at 14.3 percent, but the submarket made significant strides over the past year with a 440-basis-point drop.