Following a disappointing 2017, which marked the weakest year since 2013 in terms of sales activity in the Manhattan office market, the borough seems poised for a more fruitful 2018. The final quarter of 2017 signaled an imminent comeback for the market, even in the seeming absence of high-profile Asian investors buying prized office gems in the heart of Manhattan. The first quarter of 2018 reinforced that trend, with sales volume keeping steady and average prices reaching a new high of $1,266 per square foot. The office pipeline is also expanding, and the upcoming quarter will add new staples to the Manhattan skyline, including 3 World Trade Center and 55 Hudson Yards. Read on to see how the market fared during Q1 2018 and get a glimpse of what’s coming in the year’s second quarter.

Office Sales Volume Keeps Steady at $4.5B, Even With No Foreign Buyers

After hitting an all-time low in terms of dollar volume in Q3 2017, sales activity in Manhattan bounced back during Q4 and kept the momentum going during the first quarter of 2018, Yardi Matrix data shows. A total of 9 office deals closed for $4.5 billion during Q1 2018, marking a 126% growth year-over-year and just a 2% decrease compared to the previous quarter. While the total dollar volume recorded during the first months of the year is nowhere near the high point of Q1 2015, when 21 office properties changed hands for more than $10 billion, the market seems to be stabilizing after a series of disappointing quarters. It’s safe to say, at least for the time being, that fears of an office bubble bursting in Manhattan are unfounded, even with foreign buyers seemingly out of the picture–all the office assets traded in Manhattan during Q1 were acquired by U.S.-based companies (that we know of–foreign investors might still be partnering with U.S.-based companies in ventures that are not made public).

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