Manhattan’s Office Pipeline Expected to Shrink

As of February, Manhattan’s construction pipeline saw 19.2 million square feet of office space in the making, roughly 54,000 square feet more than the previous month, according to CommercialEdge data. The pipeline amounted to 4 percent of total stock.

Across the U.S., 146.6 million square feet of office space was underway, representing 2.2 percent of total stock. Even though the borough’s under-construction stock has also expanded by more than 300,000 square feet year-over-year through February, predictions anticipate a significant decrease of the pipeline once older projects conclude. Since the beginning of 2021, only 2.1 million square feet of office space has broken ground, compared to 3.2 million square feet in 2019 and 5.7 million square feet in 2020.

Among gateway markets, Boston is the city with the second-largest development pipeline, only trailing Manhattan. In terms of relative stock, Miami leads all gateway markets, with 7.8 percent of total stock under construction, followed by Boston (4.9 percent) and Manhattan. Washington, D.C. (1.1 percent), Chicago (1.4 percent) and Los Angeles (1.5 percent) are at the other end of the spectrum, bearing the lowest rates.

New office space in Manhattan

The largest office project in Manhattan remains the 58-story, 2.9 million-square-square 50 Hudson Yards tower, which topped out in February 2021. The project, set to become the fourth-largest office building in New York City, is nearing completion. Mitsui Fudosan owns a 90 percent stake in the Foster + Partners-designed structure, which will offer a direct subway connection. BlackRock and Meta are among the high-profile tenants that committed to the project.

Since January, The Moinian Group’s spec development dubbed Hudson Arts Building is the only large-scale commercial project to have broken ground in Manhattan. Designed by Studios Architecture, the 10-story building in Chelsea was scheduled for groundbreaking before the pandemic, but the health crisis stalled its construction.

CommercialEdge covers 8M+ property records in the United States. View the latest CommercialEdge national monthly office report here.