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Starting rents segmented by industry demonstrate vastly different leasing strategies

  • ​The 'war for talent' accelerated leasing activity and thus rent growth in some of the most amenity-rich districts in Manhattan, namely in Midtown South and Hudson Yards / Manhattan West. Starting rents in those submarkets grew by 12.1 percent and 4.5 percent from 2016 to 2017, respectively, while starting rents for properties located elsewhere in Manhattan decreased by 1.0 percent.
  • High-tech tenants inked high-profile deals in the aforementioned districts as well as Class A towers located in Midtown. As a result, starting rents for those firms increased by 13.3 percent per annum from 2015 to 2017.
  • Traditionally located in less expensive markets, relocations to Manhattan West by business services giants EY and Accenture helped to accelerate rents for that industry to the top of the market.
  • Mainstay financial services companies remained among the highest-paying occupiers in 2017; however, legal services firms were increasingly conservative as indicated by a 7.3% decrease in starting rents from 2016 to 2017.​

Note: Excludes subleases. Weighted averages used above. Business services excludes flexible space providers.
Source: JLL Research​

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