Demand in the Manhattan office market considerably outperformed in 2018. Total leasing activity of 32.4 million sq. ft. was the highest annual total since 2000 and culminated in 1.72 million sq. ft. of positive absorption. Financial services, tech and coworking/flexible space operators were especially active, and leasing was up year-over-year across nearly all size categories.
The CBRE ecomonic outlook for 2019 is positive, with office-using employment growth expected to continue at a slightly slower yet still-healthy pace. The optimism is attributed to a robust list of active requirements for office space and the healthy pipeline of new construction and large-block availabilities. We expect stable pricing, leveling off of tenant improvement allowances and an availability rate that remains equilibrium.