NYC Market Update: Manhattan Office Sales Prices Inflate

In June, nearly 474,000 square feet of office space changed hands in Manhattan at a combined price of $649 million, according to CommercialEdge data.

On a year-to-date basis through June, Manhattan’s total transaction volume reached $2.11 billion, representing a 38.6 percent decrease compared to the first six months of 2020. Even though transactions activity has scaled down, prices are up: the average price per square foot in 2021 so far hit $1,249. The figure indicates a 61 percent uptick from last year’s $776 per square foot.

The borough’s largest deal in June was SL Green Realty Corp.’s sale of 635-641 Sixth Ave., a pair of adjoining towers in Midtown South’s Chelsea neighborhood. California-based Spear Street Capital picked up the 267,000-square-foot asset for $325 million, or $1,217.2 per square foot, close to Manhattan’s average for the first half of the year.

In a separate portfolio transaction, Northwood Investors purchased two adjacent buildings in SoHo from Tahl Propp Equities. The $323.5 million deal included 524 and 520 Broadway, comprising 144,000 square feet and 66,000 square feet, respectively. Both properties date back to the beginning of the 20th century.

June brought the first significant transaction of 2021 to Brooklyn: the $53.8 million sale of Sheepshead Bay Medical Office Tower. Seavest Healthcare Properties picked up the Class B asset at 902 Quentin Road from Marx Development Group. The 71,516-square-foot property changed hands at $751.6 per square foot. At the time of the closing, the eight-story building was 100 percent leased and anchored by NYU Langone Health and Touro College of Health Sciences.

CommercialEdge covers 8M+ property records in the United States. View the latest CommercialEdge national monthly office report here. We included properties of 25,000+ square feet in our research.