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Coworking firms cluster in lower cost districts

• Distinct clustering of firms have been found in the upper Midtown South market (Chelsea and Gramercy Park) and in the Financial District.

• Average net effective rents in low density coworking areas are significantly higher than high density areas in the majority of Midtown and in Chelsea and Gramercy Park, with significant peaks occurring in Plaza District and Union Square.

• Given their value proposition in the market, coworking firms tend to gravitate towards less costly parts
of Manhattan.

• This is evidenced by a high concentration in Grand Central, where average asking rents of $67.37 p.s.f. represent an 11% discount to Midtown as a whole.

• Conversely, coworking concentration is lowest in areas such as the Plaza District and Greenwich Village, where asking rents are among the most expensive in the country.​

• In SoHo, an anomaly of high density of working and high average net effective rates highlights SoHo’s current coexistence with traditional office product and coworking.

• Downtown’s average net effective rates are categorically lower when compared against Midtown and Midtown South which is less a function of density of coworking and more representative of broader market dynamics.

Source: JLL Research

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