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New York has been leading the charge in nationwide office recovery, with office foot traffic now only 5.5% lower than its pre-pandemic levels<\/a>.<\/p>\n Manhattan has also been ramping up on office leasing. A fourth-quarter report<\/a> from commercial real estate brokerage Lee & Associates<\/a> found that 10M SF of offices were leased during this time, and vacancy, at 13.9%, was at its lowest point in the last five years.<\/p>\n One large contributor to this recovery has been the return-to-office push spearheaded by finance firms, with technology companies following suit, Lee & Associates principal and Executive Managing Director Dennis Someck said.\u00a0<\/p>\n \u201cNo one expected New York to rebound as quickly as it has,\u201d Someck said. \u201cIf you looked at this six or eight months ago, no one would have thought this is what would happen.\u201d<\/p>\n Many Manhattan companies have embraced hybrid work<\/a>, with 69%\u00a0employing a hybrid policy<\/a>.\u00a0<\/p>\n While in the past, landlords had been doing one-to-three-year leases, now they are looking for tenants to commit for the long haul \u2014 at least five to\u00a010 years\u2014 which can help justify high construction costs, Someck said. Landlords have been embracing strategies like incorporating best-of-the-best amenities and build-outs to\u00a0encourage\u00a0tenants to commit to longer lease terms.\u00a0<\/p>\n \u201cQuality sublease space has tightened up the market because companies want to move into a space where they can attract employees, especially if they\u2019re growing,\u201d Someck said. \u201cThey don\u2019t want to move into a tired, run-down, archaic sublease space.\u201d<\/p>\n He said some landlords have prebuilt large office spaces so that tenants with large\u00a0staffs\u00a0that are moving forward with their hiring and need space immediately can move in without having to wait for the space to be constructed.<\/p>\n Companies have been prioritizing high-quality properties in desirable parts of Manhattan as a way to entice employees. Lee & Associates principal and Executive Managing Director Justin Myers said finance companies have been flocking toward Midtown, Hudson Yards and Grand Central, while\u00a0artificial intelligence companies have eyed the NoMad, Flatiron and SoHo neighborhoods.<\/p>\n Due to the competition for quality spaces, tenants would need to snatch up a space quickly or risk losing out on it, Someck said.\u00a0<\/p>\n \u201cBecause Class-A and A-plus space is very hard to find right now, companies have started looking at Class-B spaces,\u201d\u00a0Myers\u00a0said. \u201cThe fully renovated buildings have leased up dramatically, and now tenants are filtering down because they have no other options.\u201d<\/p>\n Among the most sought-after amenities<\/a> for companies are rooftop decks, outdoor space, caf\u00e9s, lounges, a fitness center and a conference center.<\/p>\n Lee & Associates works with New York City landlords to help them get tenants into their spaces and helps tenants find spaces and evaluate their options based on pricing, their plans for hiring, and their short- and long-term goals and needs for the space based on how often employees are coming to the office.<\/p>\n Companies may be set on a particular neighborhood, but if the price isn\u2019t right or the competition is too steep, Lee & Associates can show\u00a0them\u00a0a desirable area that\u00a0might not have been on\u00a0their\u00a0radar,\u00a0Myers said. While clients have the final say on what space makes the most sense for their business and employees, Lee & Associates ensures they have the information they need to make their decision.<\/p>\n \u201cOur relationships with landlords and brokers around the city means we understand how office deals need to be transacted and can give proper guidance to our clients,\u201d Myers said. \u201cBeing close to our clients\u2019 strategy helps us advise them on what\u2019s best in terms of their options for office space in the market.\u201d<\/p>\n This article was produced in collaboration between\u00a0Lee & Associates<\/a>\u00a0and Studio B. Bisnow news staff was not involved in the production of this content.<\/p>\n