The Plaza office market is struggling, as companies cut back or seek to lease offices in trendier neighborhoods downtown.
Availability in the Plaza district reached a two-year high last month — 12.3 percent, up from 10.5 percent last year — after offices previously occupied by Citigroup and General Motors were listed for lease. The district, which extends between Sixth Avenue and the East River between 47th and 65th streets, has traditionally commanded the nation’s highest office rents. Last month, the average price per foot for Plaza office space is $80.74, the highest in Midtown, where the average is $71.28.
As previously reported, despite the elevated vacancy rates, the district’s office asking rents have barely budged.
Many financial firms — which occupy roughly 30 percent of the district’s offices — are tightening their belts, seeking lower rents, and moving into smaller spaces, brokers told Bloomberg News. Still others are simply seeking cooler addresses south of Midtown, leaving hundreds of thousands of pricey square feet vacant. [Bloomberg] – Jane C. Timm