Commercial leases boom on Avenue of the Americas
Celebration will be in the air on May 25 when the Avenue of the Americas Association holds its annual meeting at the Rainbow Room. What most New Yorkers call Sixth Avenue is enjoying a little-recognized commercial boom even as the overall Manhattan office and retail markets struggle.
In a nutshell, the Sixth Avenue/Rockefeller Center submarket’s 42 million square feet are cleaning the clocks of other office districts. Its first-quarter vacancy rate was 14.6 percent compared with more than 20 percent in every other similar-sized submarket, according to Cushman & Wakefield.
CBRE found 12.3 percent availability for Sixth/Rock versus 18.5 percent for Manhattan as a whole.
There’s a leasing frenzy at the Durst Organization’s 1155 Sixth, where Global Relay USA recently signed for the top five floors.
Law firm Latham & Watkins just brought Rockefeller Group’s 1271 Sixth to 100 percent occupancy; a massive new Avra restaurant will open on the tower’s ground floor in June.
A magnificent new, $50 million public plaza will open late this year at Rock Group’s 1221 Sixth Ave.
Brookfield transformed drab 1100 Sixth Ave., aka Two Bryant Park, into a gleaming glass jewel box for Bank of America.
Landlords including Rockefeller Group, Durst, SL Green and Fisher Brothers have pumped tens of millions of upgrades into their properties.
CBRE dealmaker John Maher noted: “Many were writing off Sixth Avenue in 2013-15 when numerous large blocks created the highest vacancy in the city. But those large blocks created large-space opportunities for large tenants.”
“The reinvestment and re-leasing at the time to high-quality large tenants has created the strength and stability that the avenue is now seeing,” Maher added.
Sixth and Park Avenues are the “best business streets in the world,” Maher said.
But there’s a difference.
“While Park Avenue is largely dominated by the elite of banking and finance, Sixth has an extraordinary level of diversity, including headquarters for sports such as MLB, media and entertainment (News Corporation, Comcast), and tech firms (SalesForce),” Maher said.
The tenants’ diverse workforces help support an emerging retail and restaurant climate, with such names as Del Frisco’s, the Steinway Piano showroom and vinyl music emporium Rough Trade.