Third Avenue office rents jump, availability drops

While the area is increasing in popularity, brokers say bargains are still to be had

New York /
Oct.October 21, 2014 10:38 AM

Third Avenue — once the last resort for New York’s office tenants — is gaining in popularity due to the city’s improving office market.

The availability rate of the area through September dropped to 10.7 percent from 13.4 percent at the end of 2013, according to CBRE data reported by the Wall Street Journal. Midtown’s overall availability rate was 11.1 percent. During the same period, rents on Third Avenue rose to $59.90 per square foot from $57.45 per square foot.

“The time of $40 rents has gone,” Giacomo Barbieri, head of real estate acquisitions in the Americas for TIAA-CREF and a landlord of buildings in the area, told the newspaper.

Law firms, insurance companies and private equity firms that would usually have looked at the pricier Sixth, Madison or Park avenues are now settling on Third Avenue.

Still, bargains can still be found on the corridor.

Six deals for more than 37,000 square feet — and that were transacted since December — included an average of 12 months of free rent . Those deals also included roughly $70 per square foot paid by landlords for improvements to the spaces, Richard Persichetti, vice president at Cassidy Turley, told the newspaper. In comparison, Midtown incentives usually include about six months of free rent and between $50 and $60 of space improvements per square foot. [WSJ] — Claire Moses


Related Articles

arrow_forward_ios
Reynolds Asset Management's Lou Reynolds and 7-15 W Main St in Bound Brook, NJ (Illustration by Kevin Cifuentes for The Real Deal with Getty Images, Loopnet, Reynolds Assets Management)
Tri-state roundup: These New Jersey and Long Island deals aren’t turkeys
Tri-state roundup: These New Jersey and Long Island deals aren’t turkeys
Empire Capital Holdings' Josh Rahmani, Hakimian Capital's Michael Hakimian, RXR's Scott Rechler and 1330 6th Avenue (Getty, Hakimian Capital, Empire Capital Holdings, 1330aofa.com)
Empire Capital, partners close on $320M deal for 1330 Sixth Ave
Empire Capital, partners close on $320M deal for 1330 Sixth Ave
(Illustration by The Real Deal; Getty)
Just 2 percent of US office market slotted for conversion
Just 2 percent of US office market slotted for conversion
 Related Companies’ Stephen Ross and Brookfield’s Brian Kingston (Illustration by The Real Deal; Getty)
Mapping out the explosion of commercial development in Hudson Yards
Mapping out the explosion of commercial development in Hudson Yards
355 West Broadway and Bridge Investment Group’s Teresa Mireles Hough (Loopnet, Bridge Investment Group, Getty)
Bridge buys in Soho, Slate in Gowanus in quiet week of i-sales
Bridge buys in Soho, Slate in Gowanus in quiet week of i-sales
JPMorgan Chase's Jamie Dimon, Deutsche Bank's Christian Sewing and Barclays' Nigel Higgins (JPMorgan Chase, Deutsche Bank, Barclays, Getty)
Office lenders looking for an off-ramp
Office lenders looking for an off-ramp
Vornado Realty Trust chairman Steven Roth (Photo Illustration by Steven Dilakian for The Real Deal with Getty)
Developers punt on new office projects
Developers punt on new office projects
Speaker Spotlight: Get to know Jeff Greene
Speaker Spotlight: Get to know Jeff Greene
Speaker Spotlight: Get to know Jeff Greene
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...