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Episode Info: Welcome to the New York Office Market Update Here we dig into the latest data and trends to find out what is really happening in the local Office market to help landlords, real estate investors, and developers make the smartest financial moves. So, what’s new in Brooklyn Office Market? Let’s take a look at the numbers… Although more new construction inventory appears to be hitting the market, creating more available office space, asking rents just keep going up. Big players like Microsoft and JP Morgan Chase continue to be bullish on NYC real estate and office space in the Big Apple. We’ve even seen major retailers stage a comeback. That includes Nordstrom, Apple, and even a PayPal store. Still, as Brooklyn office rents begin to compete with Manhattan’s, we’ve seen more major companies move and expand to Brooklyn. Even some from Fifth Avenue and Broadway. Technology companies appear to still be the hottest and fastest-growing tenants. A group that can benefit landlords of small creative office lofts and new office buildings Around 10% of all inventory is new or is still under construction and coming to the market from now through 2024.   In Brooklyn Total inventory rose to 36.4M square feet Percentage available for lease decreased to 15.8% Absorption rate negative by 297,585 square feet Asking rents are up to $40.45 per square foot on average Asking rents in prime buildings in Bushwick and Williamsburg can be as high as $70 per square foot At least 2.9M square feet of office space is under construction   Notable construction and renovation projects include: Four new major large-scale developments hit the market in Q3 2019: Panorama - 733k square feet Dock 72 - 220k square feet 25 Kent Avenue - 508k square feet 341 39th Street, Sunset Park - 214k square feet   Notable upcoming projects include: The Wheeler in Downtown Brooklyn The Hall at Brooklyn Navy Yard 399 Sands Street 101 Fleet Place 12 Franklin Street 80 Flatbush 570 Fulton Street 625 Fulton Street Domino Sugar Factory aka Ten Grand One Willoughby Square 30-56 Gem Street 189 Pennsylvania Avenue Notable relocations and expansions from Manhattan to Brooklyn include: Rent the Runway 2U Amazon Time Inc American Transit Insurance Bauble Bar Koppers Specialty Chocolate Laundry Service Bjarke Engels Group Although delivery of new construction is expected to decline until 2022, that is forecast to be the year we’ll see the delivery of more new office space hitting the market and taking off again through 2024.   Market Factors & Economic Indicators Unemployment stood at 3.7% as of October 2019 according to the Federal Reserve Bank of St. Louis. This could be negatively impacted over the next year or two due to new rent control laws and sweeping new labor laws eliminating the freelance workforce. An estimated 60% of Brooklyn workers worked remotely in 2019. New taxes could also be a factor. In addition to SALT deduction caps and new transfer, mansion tax, and higher prop...
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