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Manhattan, NY, office leasing soared in 2019; $479M refinancing for NYC property

Commercial real estate

* The 2019 office leasing volume in Manhattan, N.Y., was the highest since 2001, The Real Deal reported, citing research from Colliers International. The annual total came to 42.97 million square feet, up 2.9% from 2018 and 28.4% higher than the 10-year average. The average asking rents closed the year at $78.78 per square foot, after rising to an all-time high of $79.77 per square foot in the third quarter.

* Brookfield Property Partners LP and the Qatar Investment Authority received a $479 million refinancing from Bank of China for the residential portions of the 62-story Eugene in Manhattan, The Real Deal reported, citing property records filed with the city. The 3 Manhattan West building has 844 apartments, including 169 affordable units, and retail space on the lower four levels.

* Clarion Partners and MHP Real Estate Services received a $372 million financing from ING Capital for an office building in Manhattan's Financial District, The Real Deal reported, citing city records. The deal has a five-year term and was brokered by Eastdil Secured, the report added, citing a source with knowledge of the transaction.

The 41-story building was acquired in 2015 for $470 million and The Blackstone Group Inc. had financed the acquisition with a $247.5 million loan at the time, the report noted, citing records. The property is 90% occupied.

* CBRE Group Inc.'s market outlook report expects the U.S. multifamily sector's vacancy rate to rise 20 basis points to 4.5% in 2020, The Real Deal reported. Rental growth is predicted to slow to 2.4%, compared to the long-term average of 2.6%.

About 280,000 new units are expected to be delivered across the country, while starts and permits are expected to decline during 2020.

* The number of coworking spaces across the world is expected to double by 2025, although present headlines regarding the misfortunes of WeWork Cos. Inc. make it seem like the entire sector is in trouble, The Real Deal reported, citing estimates.

* Urban Renaissance Group and Miller Global Properties sold the Lincoln Executive Office Center in Bellevue, Wash., to a partnership between PCCP and URG for $114.5 million, the Puget Sound Business Journal reported, citing a King County sales affidavit. The price for the six-building, 14-acre property marks a gain of $34 million from its previous sale in 2016, the report noted.

* A subsidiary of Inc. paid $73 million for a 100.2-acre undeveloped parcel at 25020 Willard Road in Chantilly, Va., that could serve as a potential data center site, the Washington Business Journal reported, citing public records.


* Manhattan home sales were down 1.2% year over year in the fourth quarter of 2019, marking the smallest year-on-year decline since 2017, Bloomberg News reported, citing Miller Samuel Inc. and Douglas Elliman Real Estate. Sales have declined in eight of the nine past quarters.

The median price of condominiums and co-ops remained unchanged year over year during the quarter at $999,000, and listings inventory was up 9%.

The day ahead

Early morning futures indicators pointed to a lower opening for the U.S. market.

In Asia, the Hang Seng declined 0.79% to 28,226.19, while the Nikkei 225 was down 1.91% to 23,204.86.

In Europe, around midday, the FTSE 100 slid 0.94% to 7,550.50, and the Euronext 100 fell 1.13% to 1,144.27.

On the macro front

The PMI services index and TD Ameritrade IMX are due out today.

Click here to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

Now featured on S&P Global Market Intelligence

Big slowdown expected in coworking, flex office leasing: Office market analysts said the WeWork drama in the fall will manifest strongly in 2019 fourth-quarter leasing data, but the long-term trajectory of the coworking and flex office market is up.

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