Manhattan’s slumping office market is about to be delivered a huge blow next year, according to the Wall Street Journal, when 6 million square feet of new office space will be delivered to the market — the most since 1989.
The unsteady global economy and the compression of the financial services industry have hampered demand for office space in recent quarters. Developers point to the city’s growing tech, law and media sectors for relief, but the Journal noted that those tenants tend to prefer using smaller space more efficiently to signing for extremely large blocks.
The developers of the buildings, 1 World Trade Center, 4 World Trade Center and 51 Astor Place, say they aren’t worried because of the dearth of new construction in the years preceding the upcoming one. But the one high-profile property to be built recently, at 11 Times Square, has failed to land tenants for 60 percent of its 1.1 million square feet more than a year after opening.
The success of these developments could determine how soon other high-profile projects, like Hines Interests’ 7 Bryant Park and the Related Companies Hudson Yards, get off the ground. [WSJ]