Q1 2023 Industrial Real Estate Report: New York, NY
Specializes in providing actionable insights into the commercial real estate space for investors, brokers, lessors, and lessees. He covers quarterly market data reports, investment strategies, how-to guides, and top-down perspectives on market movements.
New York City is known across the globe for its vibrant street life, bustling energy, and array of culinary delights.
Major industries in New York City include finance, media and entertainment, fashion, technology, healthcare, and tourism.
The current population of New York City is 18.9 million people with a 0.37% growth rate.
New York City's industrial real estate market performed well in Q1 2023 behind strong leasing activity, continued sales, and positive absorption.
General Area Overview & Demographics
New York City, often referred to as the "Big Apple," is a vibrant and diverse metropolis located in the northeastern part of the United States. Known as one of the world's most iconic cities, New York City is a hub of culture, finance, media, and entertainment. With its rich history, stunning architecture, and countless attractions, it is no wonder that the city draws millions of visitors each year.
New York City's Economy, Demographics, and Geographic Makeup
The city is situated on the eastern coast of the United States, at the mouth of the Hudson River. It is composed of five boroughs: Manhattan, Brooklyn, Queens, the Bronx, and Staten Island. Each borough has its own distinct character and attractions, contributing to the city's dynamic atmosphere.
The demographics of New York City reflect its status as a melting pot of cultures and ethnicities. The city's population is incredibly diverse, with residents hailing from all corners of the globe. People of various racial and ethnic backgrounds, including White, African American, Hispanic, Asian, and Middle Eastern, call the city home. This multicultural environment has fostered a vibrant atmosphere where different traditions, languages, and cuisines converge.
Manhattan, the city's central borough, is home to renowned sites such as Times Square, Central Park, the Empire State Building, and Wall Street. It serves as a major global financial center, attracting professionals from the finance, technology, and creative industries.
Beyond the iconic skyline, New York City offers a wealth of cultural experiences. It boasts world-class museums like the Metropolitan Museum of Art and the Museum of Modern Art (MoMA), as well as Broadway theaters hosting world-famous productions. The city is also celebrated for its diverse culinary scene, ranging from street food vendors to Michelin-starred restaurants.
New York City's demographics and attractions contribute to a thriving social scene. The city is home to a wide range of entertainment options, including music venues, comedy clubs, and nightlife hotspots. Residents and visitors can enjoy a plethora of recreational activities, including parks, sports events, and shopping districts.
Summary of New York Industrial Real Estate Performance in Q1 2023
Total vacancies for New York industrial real estate landed at 1.8% by the end of Q1 2023. The South Bronx submarket posted the highest vacancy at 3.4%.
Industrial absorption for the quarter reached 522,968 square feet. New York, NY still remains to be one of the most expensive cities to lease commercial real estate in the country.
What are industrial real estate rents like in New York?
The average total asking rent for New York industrial real estate slightly rose over Q4 2022's numbers, landing at $36.17 per square foot in Q1 2023. Properties on the Brooklyn Waterfront saw the highest average rent at $39.04 per square foot.
South Brooklyn industrial properties posted the lowest average rent at $19.00 per square foot.
Purchase & Leasing Activity
Total sales volume for New York industrial real estate posted at $287 million by the end of Q1 2023, a 63% decrease quarter-over-quarter and a 173% decrease year-over-year.
Approximately 559,000 square feet of industrial space were leased in the city in Q1 2023, with the majority of that space leased in Brooklyn.
Notable Industrial Space Deals in New York in Q1 2023
There were several notable deals that took place for New York industrial real estate in Q1 2023:
- Windstar Construction purchased 44,000 square feet in Flushing for $40 million.
- Terreno Realty Corporation purchased 45,000 square feet in Long Island City for $23 million.
- BRAM Auto Group purchased 53,000 square feet in Woodside for $17.4 million.
- Linzhong Zhou purchased 21,500 square feet in Queens for $13 million.
These are select examples among other activity.
New Industrial Real Estate Development Activity in New York in Q1 2023
About 3.4 million square feet of new industrial space were under construction in Q1 2023 in New York City. Year-over-year, this results in a 1.3 million square feet decrease in new construction.
Industrial completions for the quarter totaled 393,000 square feet. Queens accounted for all of Q1 2023's new deliveries.
Market Forecast for New York's Industrial Space Market
About 2.1 million square feet of new deliveries are expected to come on the market this year, which is likely to increase vacancies as well as average asking rents.
Takeaways for Industrial Real Estate Investors
Growing demand for outdoor storage and parking is creating positive investment opportunities for NYC investors. Look to acquire land quickly, as there is a current shortage of developable land.
Investors looking to sell property this year should note that sales volume was mild in the first quarter due to economic challenges. Whether sales will return to their past levels depends largely on the performance of the economy as the year unfolds.
Do your research, stay diligent, and happy investing.
Find & Connect With Commercial Agents & Brokers in New York for Free on MyEListing.com
Leverage one of the nation's largest databases of commercial agents and brokers to find an agent or broker in New York for free.
Other recent articles
Article Search
Share
All Article Categories
