The amount of workspace available to lease in Manhattan rose to an all-time high in April as demand in the premier U.S. office market was 27% lower than a year ago even as rental prices continued to fall, brokerage data showed on Monday.
The availability rate for office space in Manhattan rose for the 11th consecutive month in April to a record 16.5%, according to Colliers International (CIGI.TO). Availability above 10% on the island is considered a renter’s market.
Leasing activity in Manhattan decreased 46% from March and was 75% lower from the monthly average in the banner year of 2019, suggesting the market still has a long way to recover.
In a sign of a market potentially on the mend, available sublet space, now representing almost 24% of all available space, fell for the first time since May 2020. When sublet space surpasses 25% of all available space, it is considered a glut.
“It’s difficult to draw any long-term trends with one month of data,” said Frank Wallach, senior research director in New York at Colliers. “April began to show early inklings of a possible thaw in the wave of sublet space.”
Despite the glimmer of an uptick, other data showed a market still in the grip of the pandemic.
The average asking rent in Manhattan decreased 0.4% to $72.97 a square foot, the lowest since December 2017. Since the downturn began in March 2020, the average has fallen by 8.2%.
Only one lease was for more than 100,000 square feet, a transaction for 109,000 square feet (10,126 square meters) leased by software company Schrödinger’s at 1540 Broadway.