NYC Market Update: What’s Driving Manhattan Construction
Repurposing vintage buildings accounts for much of the borough’s office pipeline, according to CommercialEdge.
As of September, 20.8 million square feet of office space was taking shape in Manhattan, or 4.3 percent of total stock, according to CommercialEdge. The pipeline has increased slightly, marking a 50-basis-point expansion month-over-month.
Nationwide 158.2 million square feet of fresh office product was under construction in September, making up 2.4 percent of total stock. The U.S. pipeline has been gradually reducing its size since the global health crisis generated headwinds for the sector. Among gateway markets, Manhattan is faring well in terms of pipeline relative to stock, along with Boston (5.4 percent), Seattle (4.7 percent) and Miami (4.3 percent), while Chicago (1.3 percent), Washington, D.C. (1.6 percent) and Los Angeles (2.8 percent) are on the other end of the spectrum.
In Brooklyn, roughly 2 million square feet of office space was underway in September. The same month, developers Edward J. Minskoff Equities Inc. and J.P. Morgan Global Alternatives broke ground on 29 Jay St., a mixed-use property in DUMBO. The building is the first new office space in the neighborhood in over a century. Designed by New York City-based architecture studio Marvel, the project will offer 240,000 square feet of Class A office space and 12,000 square feet of retail.
Reshaping history
Since the beginning of the year, four significant projects have broken ground in Manhattan, with just the 414,000-square-foot Urban League Empowerment Center in Harlem being a newly constructed structure. The remaining projects are redevelopments of existing buildings, such as the $350 million makeover of the Textile Building in Manhattan’s Midtown South. Park-It Management is repurposing a former parking garage into a medical office facility in Harlem. The property at 160 West 124th St. will provide 89,000 square feet of medical office space across 12 stories.
Taconic Investment Partners is developing a 3.4-acre life sciences and office complex dubbed West End Campus on the Upper East Side. The largest, 400,000-square-foot building at 125 West End Ave. represents the redevelopment of a former Chrysler auto showroom into a life science facility. Construction is underway since early 2021.
CommercialEdge covers 8M+ property records in the United States. View the latest CommercialEdge national monthly office report here.
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