June 22, 2017
Giant developments on the Far West Side of Manhattan are stirring up the market for office space — pushing both asking rents and vacancy rates higher.
“The coming availability of large blocks — either as a result of tenants migrating to new construction or consolidation in the banking and legal industries — will continue to impact the market as we enter the late stages of the cycle,” according to JLL’s June 2017 Monthly Market Update.
The towers of Hudson Yards are already attracting office tenants from other buildings. The percentage of Class A office space that was vacant in Midtown rose to 11.6% in May 2017 from 11.5%. In the Plaza District of Midtown, the Class A vacancy rate rose to 12.3% from 11.9% — the highest since 2013.
Asking rents rose to $83.70-per-square-foot on average from $82.22 in May, largely the result of higher quality space coming to market.
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