New York City is booming. The local economy is the strongest it has ever been, with total employment numbers reaching all-time highs totaling over 4.2 million jobs through May 2015. This has led to a strong office market performance during the first six months of 2015, as office-using employment continues to grow, up 2.5 percent over the past 12 months. Demand for space continues to keep availability below 10 percent, and at 9.6 percent, Manhattan availability is down 50 basis points from last year. Despite minimal increases in Manhattan overall asking rents, up only 2.9 percent year-over-year through June, some submarkets are exceeding previous record-high asking rents from 2008. The demand from creative and tech tenants looking for space in Midtown South over the past few years has pushed asking rents up 19.1 percent above all-time highs. Downtown overall average asking rents have reached historical highs this year as well, and at $57.78 per square foot, rents are 10.3 percent higher than the previous highs in 2008. Most of this increase can be attributed to new construction at the World Trade Center site. Despite this, Midtown overall asking rents are still 5.3 percent off historical highs from 2008. Throughout Midtown, …
Seven years after the worst recession this country has seen since the Great Depression, New York City is riding high again. Manhattan has emerged as a vital center for global retail activity where we continue to see dynamic growth — driven by its economic fundamentals, urban migration, and its cultural and lifestyle attractions. Gone are the days when suburban expansion sounded the death knell for high street retail. Since 2010, in the near-aftermath of the economic collapse and for the first time in decades, urban cores are growing at a faster rate than their suburban counterparts. Eighty percent of Americans now live in urban areas, and retailers and property owners in New York City and around the world are scrambling to adapt. Millennials represent 24 percent of the overall U.S. population and are leading this urban charge. They want to live close to work. They’re driven by technology — and they demand an omni-channel retail experience that integrates smartphone and tablet use with a personalized, service-oriented, in-store approach. And importantly, it’s estimated they will represent nearly 30 percent of U.S. retail spending — the total of which was $4.6 trillion this year — by 2020. Manhattan also continues to benefit …
Job growth in New York City is expected to reach a new high in 2015 with the addition of 92,500 jobs. This spike in employment will bode well for retail owners. Drawn by the strong economy, several retailers are expanding in the city, including Lowe’s, which already has two locations in Brooklyn and one in Queens. In the second half of 2015, Lowe’s will open its first two stores in Manhattan. Apple plans to open shop in Brooklyn; they’ve signed a long-term lease for a 20,000-square-foot store at 247 Bedford Avenue at the corner of North Third Street in Williamsburg. As retailers ramp up their presence in the five boroughs, the vacancy rate is going to reach a new multi-year low. Vacancy for retail properties in 2015 will fall to 3.9 percent on net absorption in excess of 2.8 million square feet. Tightening vacancy will allow for operators to increase asking rents for the fourth consecutive year and will encourage builders to start new projects. Currently, builders are on track to deliver 2.5 million square feet of retail space in 2015, increasing stock by 1.2 percent. The most notable project scheduled for delivery is the Westfield World Trade Center, a …
NEW YORK – HFF has arranged a $556 million construction loan for a full-block office development on Manhattan’s Park Avenue. The 47-story tower will be located at 425 Park Ave. in Midtown’s Plaza District. L&L Holding Company and GreenOak Real Estate are developing the 670,000-square-foot project. This will be the first full-block office development on Park Avenue in nearly 50 years, according to HFF. The new project will feature flexible floor plate sizes and layouts. All floors will contain views of Midtown. Central Park will be visible to floors 24 and higher. The development is also situated near Rockefeller Center. Project amenities include a private garage for tenants with a special car lobby, a private building entrance and a chauffeurs’ lounge. It will also contain a space dedicated to amenities on the 26th floor that will feature outdoor areas with views of Central Park, a wellness center, and dining, meeting and conference rooms. The lobby will contain an atrium with floor-to-ceiling glass. The building’s 56th Street and Park Avenue corner will boast a high-end restaurant, while the 55th Street and Park Avenue corner will house retail and gallery space. HFF’s Mike Tepedino, Michael Gigliotti and Jennifer Keller arranged the construction …
New York City multifamily has historically been a darling of the real estate industry — and for good reason. It is arguably the most sought-after investment product type within commercial real estate investment’s most targeted city. It is the perfect demographic storm on the demand side: two-thirds of the population rent versus own; the population is arguably the best educated and includes the highest income generators in the nation; and the market continues to exhibit vast growth in household creation and population. Not to mention, the supply side is both geographically and politically constrained. These limitations are further exacerbated by very high costs to build. However, even with the dual push of supply and demand continuing to be in investors’ favor citywide, there are some areas that are softening. Two areas that seem to be softening are luxury condominiums in Manhattan and rental product in Long Island City (Queens) and the downtown Brooklyn area. Manhattan Luxury Condo Sales Slowing Manhattan is often a trendsetter that is months and years ahead of the rest of the country when it comes to real estate trends, and the return of the luxury condominium market is a prime example of this. Some 2,500 units were …
NEW YORK — Kushner Cos. has purchased a retail condominium building in New York that formerly served as the headquarters for The New York Times for $296 million. The 250,000-square-foot building is located at 229 W. 43rd St. The 18-story space occupies a full block in the Times Square corridor, with frontage on 43rd and 44th streets. It served as the newspaper’s headquarters from 1913 through 2007 when the Times relocated to 620 Eighth Ave. The retail condominiums contain up to 45,000 square feet. Notable tenants at the property include Bowlmor Lanes, Haru Times Square and Guitar Center. There is about 60,000 square feet of vacant retail space. “We’re excited to acquire this wonderful Times Square retail condo, located in one of the world’s most popular tourist destinations,” says Jared Kushner, the firm’s CEO. “We believe this will be a great long-term asset, and a draw for retailers.” The seller is a partnership between Africa Israel USA and an affiliate of Five Mile Capital Partners LLC. “We are proud to have overseen the transformation of this trophy asset, and are pleased to have transferred the stewardship to such an outstanding organization as the Kushner Companies,” says Chagit Sofiev Leviev, Africa …
It’s no longer a secret that Brooklyn is booming, particularly the borough’s retail scene. Retail rents have climbed continuously over the last five years. Retail density has increased almost exponentially. A recent study by CPEX of Brooklyn’s notable retail corridors (meaning areas with rents averaging more than $35 per square foot) found the number of these corridors has increased 80 percent in just two years. But what’s driving Brooklyn’s record pace of retail growth? Several market factors have created a perfect storm for Brooklyn’s retail resurgence. Development in the borough has peaked over the past two years, with permits for new residential developments up 116 percent in that timespan. Nearly 20,000 new units are in the pipeline, almost twice the number of permits in Manhattan and 149 percent more than the other outer boroughs combined. The office vacancy rate has dropped to 4.2 percent in Brooklyn, the lowest in the United States. Tourism continues to spike thanks to the borough’s noteworthy parks, the year-round arts and cultural events in the Brooklyn Academy of Music (BAM) Cultural District, and the Barclays Center’s sporting and concert events. In the meantime, hotel developments are trying to keep pace with the influx of tourists …
NEW YORK — BFC Partners has broken ground on Empire Outlets, a 340,000-square-foot retail complex with a total of 100 designer outlet stores on the North Shore of New York’s Staten Island. The project will be situated near the Staten Island Ferry Terminal and the Richmond County Bank Ballpark, home of the minor league Staten Island Yankees, in St. George. The new development will also include a 190-room hotel and a 1,250-space parking garage. The parking structure will be located below the retail and hotel components. A number of open corridors and pedestrian walkways that lead to the water will also be integrated into the project, which is slated for completion next year. It is being designed by SHoP Architects. “Empire Outlets is a well-timed catalyst that will trigger the transformation of the North Shore and position Staten Island for sustained growth into the foreseeable future,” says Donald Capoccia, a principal at BFC Partners. “This project will be a dynamic economic engine for New York City, creating more than 1,800 construction and permanent jobs that will benefit its residents, businesses, cultural and community organizations for generations to come.” Notable retailers that have signed onto the project so far include Nordstrom …
The New York Capital Region’s industrial market has experienced strong growth over the past 24 months, and promises a continued pattern of growth for the next 12 to 24 months. As the office market in the central business district struggles to right itself fueled by the State’s tenuous occupancy of numerous privately held properties, the industrial marketplace has flourished with extended commitments from existing users and the entrance of new users. Upstate New York is making a name for itself in the nanotech industry, and a great deal of national and international attention has been drawn to the region. In addition to activity driven by high-tech companies, national distribution and manufacturing groups have committed to the region or have focused their site searches in the Capital District. The most significant job creation mechanism in the region has been the nanotech industry. Billions of private and public sector money has been invested since 2010 into Luther Forest Technology Campus in Malta, N.Y., as well as SUNY Polytechnic Institute (also known as the Colleges of Nanoscale Science and Engineering). These facilities have placed our region firmly on the international map and have transformed the appearance of New York’s Capital Region. The strongest …
Since 2010, the Brooklyn real estate market has been surging. Over the course of the last four years, the total dollar amount of commercial real estate sales in Brooklyn has increased 397 percent with transaction volume up 151 percent. In 2010, $1 billion of commercial sales were completed, compared to more than $5 billion in 2013 — and projections for commercial sales in Brooklyn for 2014 are more than $6 billion. Retail property sales in the first half of 2014 compared to the first half of 2013 have increased 33 percent in dollar volume and have seen a 12 percent increase in transaction volume. Brooklyn has become a true retail destination, with more national retailers than ever opening up shop. Barney’s Co-op is credited as being one of the first upscale retailers in the borough four years ago. J. Crew, Sephora, Nord-strom Rack and Whole Foods are several of the other nationally known retailers to make the move to Brooklyn. Apple is looking to open its first Brooklyn store, and the potential location of the store continues to be a widely discussed topic. Brooklyn offers a dense concentration of consumers for retailers to serve. According to an economic development report …