Leasing and Construction in NYC In a Post-Covid World
It’s no secret that the Covid-19 pandemic has hard hit the sectors of rental property and construction.
By now, most of us have noticed office closures and a growing number of spaces available to sublet, making a dent in the price of rental property as well as new construction projects.
But how long will these trends last? Are we looking at a recovery period equal to the many years following the 2008 Recession? Or is there hope that the city could rise again after the pandemic?
Now that an effective vaccine has moved out from the realm of hope to reality, it’s time to evaluate the damage, as well as NYC’s ability to recover.
While it’s too soon to know for sure, there are several promising signs that the city of New York is poised to come back, just as it did after the tragedy of 9/11, stronger than ever.
Here are some of those hopeful signs.
More Office Space Rented to Tech Companies
By now, most are aware that Facebook has leased a huge 730,000-square-foot space at the Farley Post Office. While this event seems striking, Facebook is not the only tech giant to open up a new space in New York City.
Apple is expanding to a second location in Manhattan. Amazon, which already has several offices in the city, purchased the historic Lord & Taylor building on Fifth Avenue with plans to open offices there.
This can be seen as a hopeful sign, even though most of these companies are embracing the work-from-home movement. With billions of employees, these giant tech companies can help fill the gap left behind by businesses decimated in the pandemic.
New Construction Projects Continue
In perhaps the greatest sign of hope of all, a dizzying number of construction projects, many of which were started before the pandemic, are continuing unchecked.
Here are just a few of them:
● The restoration of the Moynihan Train Hall ● Expansion of the Museum of Natural History ● New restaurants in Manhattan West (and throughout the city) ● Sven, the 958-unit skyscraper, to be constructed in Long Island ● The Spiral at Hudson Yards ● A new office building on the site of the World Trade Center ● Little Island Park, a floating public park at the Hudson River
Although overall spending on construction is down compared to other years, most experts agree that the construction sector is poised to see a quick rebound once the vaccine becomes widely available.
Increased Demand For Class A-Space
While leasing activity is down overall, the demand for Class A office space remains strong.
In contrast to the price of subletting, the price of Class A rental space is maintaining its edge, despite everything. In fact, since 2018, prices rose from $79.56 to $86.1 per square foot.
Covid-19 has unquestionably wreaked havoc on the construction and leasing sectors, as with most other areas of life.
But New Yorkers can take comfort in the fact that our native resilience won’t keep us down for long.