Park Avenue Offices Surge Above Competition

Park Avenue is no longer just a prestigious residential destination — it’s filling up office desks, too.

The avenue’s Midtown Manhattan stretch remains a premier location for significant office tenants, the Wall Street Journal reported. That’s evident by the relatively low vacancy rate on the stretch above Grand Central Terminal, despite high asking rents in the area.

The vacancy rate on Park Avenue is down to 8.9 percent, according to CoStar, representing a seven-year low for the avenue. That’s practically half the vacancy rate of Manhattan as a whole, which stands at 16.1 percent.

Just a few boulevards away, however, landlords are offering discounts of 75 percent compared to the going rates of Park Avenue, and yet are still struggling to fill spaces.

Companies are willing to shell out big bucks on Park Avenue. Tenants such as law firms, real estate companies, insurers and money managers continue to flock to Park Avenue.

Beyond being associated with Manhattan prestige, Park Avenue’s attractiveness surged upon the completion of the Long Island Rail Road extension to Grand Central, making it even easier for Long Island commuters to get to 42nd Street and above.

Additionally, Park Avenue is attracting businesses that jumped to Hudson Yards in recent years. At least three tenants have moved from Hudson Yards to Park Avenue since the pandemic, according to Cushman & Wakefield.

There are more office developments on the way. JPMorgan Chase plans to open its $3 billion office at 270 Park Avenue this summer. RXR and TF Cornerstone are seeking financing for 175 Park Avenue, which is expected to be the tallest commercial building in the Western Hemisphere upon completion.

And last week, the 1.8-million-square-foot project at 350 Park Avenue, spearheaded by Vornado Realty Trust and Ken Griffin, became the first office tower presented to the City Planning Commission in five years.

— Holden Walter-Warner