Manhattan's Financial Companies Are Driving Office Leasing Again
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A rendering of 50 Hudson yards
Source: Related Companies
Manhattan office leasing is on “FIRE” again.
FIRE companies -- broker parlance for finance, insurance and real estate -- committed to 11.1 million square feet (1 million square meters) of space in 2017, the most in four years, according to Colliers International. Such tenants made up 34 percent of the total 37 million square feet of deals in what was Manhattan’s most active leasing year since 2003, the brokerage said.
That share for FIRE companies would have been typical prior to the 2008 credit meltdown, but more recently, technology and media firms including Google and Facebook Inc. have been driving the market. Today’s tenant mix is more diverse than when mega-banks such as Citigroup Inc. and Goldman Sachs Group Inc. were landlords’ biggest customers, said Craig Caggiano, executive director of Colliers’ New York tri-state region.
Financial Leasing Is Back in Manhattan
Banks, insurance companies once again drive the office market
Source: Colliers International
Note: FIRE refers to financial, insurance and real estate tenants, while TAMI refers to technology, advertising, media and information companies.
“We’ve seen strong job growth in New York City, and clearly the financial-services companies and the FIRE sector in general is benefiting from that,” Caggiano said. “The question on everybody’s minds is whether this job growth is sustainable.”
The year’s biggest lease was BlackRock Inc.’s agreement to take 847,000 square feet at 50 Hudson Yards, a tower under construction on the far west side. The asset manager plans to move its headquarters there from Midtown.