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Photo: Courtesy of 4wtc.com
On Wednesday, the Downtown Alliance released their annual 2014 real estate report on the progress of Lower Manhattan. According to the report, Lower Manhattan is showing more signs of growth now than ever before.
The real estate market is surging, with the downtown area seeing its highest numbers since 2006, and employment rates reaching levels that haven’t been seen since 2003. In addition, tourism, hospitality and major retail openings continue to do big things for downtown, making it once again a thriving community.
According to the Downtown Alliance’s Year in Review, a total of 6.8 million square feet was leased in 2014, making last year downtown’s best performance in nearly a decade. 50 percent of the leasing activity came in the form of relocations with the TAMI (Technology, Advertising, Media and Information) and retail sectors accounting for nearly 65 percent of all relocations.
Moves like media giant Conde Nast moving to One World Trade Center, as well as other companies has helped diversify the business landscape seen in downtown Manhattan. While these areas have seen growth, FIRE (Finance, Insurance and Real Estate) tenants only accounted for 39.5 percent of total occupied space in Lower Manhattan, making it a significant decline from 51 percent in 2012.
The growth of other industries in the downtown area has also contributed greatly to the employment rate. The once dominant finance and insurance sectors are being joined by private sector education, social services, hotel, retail and restaurant industries. Private sector education and social services saw a 116 percent increase in downtown from 2003-2014, while professional services saw a 43 percent growth, and hotel, retail and restaurant services saw a 29 percent growth, all over an 11-year period. TAMI employment is also up significantly, with a 17 percent employment increase from 2009.
Tourism will continue to be a strong suit for Lower Manhattan, especially as the area continues to recover post Hurricane Sandy. 12.4 million visitors came to the district, which was a rebound from 2013 due to the damaged sustained in the area due to the storm. Hotel and retail inventory will also continue to increase. In 2014, hotels downtown increased by 20 percent from 2013, and 76 new stores and restaurants opened up. Retail asking rents have also increased to an average of $265 per square foot, an increase of 17 percent from 2013.
The downtown area continues to show significant progress in rebuilding and transforming into a real estate, tourism and shopping mecca. With numbers like these in 2014, the growth in Lower Manhattan is expected to continue throughout this year and into the future.
– by Jackie Hart