Sixth making sense
Businesses hot for famed NYC corridor in ’17
BIG Six — the Sixth Avenue/Rockefeller Center submarket — is king of Manhattan office leasing for the second year in a row. If dry statistics make you doze off, a short stroll along the teeming boulevard should perk you up like a dose of Adderall.
Retail and residential energy are palpable from Franklin Street to Central Park South, but Sixth Avenue’s marquee drag runs from 40th to 59th streets — home to major hotels, Radio City Music Hall and the grand sweep of office towers lovingly shown at the beginning of Woody Allen’s “Manhattan.”
That panorama, shot in 1979, looks very incomplete today, lacking One Bryant Park and other new skyscrapers.
Cushman & Wakefield data cited by the Avenue of the Americas Association show that for all of 2017, Sixth Avenue leasing outpaced any other major Manhattan avenue or cross-street — a total 3.27 million square feet, up nearly 42 percent from 2.31 million square feet in 2016.
By comparison, the second-highest leasing volume was recorded on Tenth Avenue, which saw 1.66 million square feet — the bulk of it in new and redesigned buildings at Related Companies/ Oxford’s Hudson Yards and at Brookfield’s Manhattan West.
In the Sixth Avenue/Rock Center district’s 41 million square feet — a total second only to the Grand Central District’s 43.5 million square feet — overall vacancy in the fourth quarter of 2017 fell to 9.6 percent from 10 percent a year earlier. Average asking rents were a solid $85.36. Class-A “asks” were $86.68.
The narrow difference between the overall ask and the class-A ask reflects a simple fact that defines Sixth Avenue: Nearly all its office space is Class A. (By comparison, according to Cushman, the average ask for all of Midtown was $76.94 for the fourth quarter, versus $83.57 for Class-A space — a gap reflecting a much higher volume of older, obsolescent space than exists along Sixth Avenue. Among 2017’s largest new leases: Mizuho Americas added 270,000 square feet at 1271 Sixth, the former Time & Life building, on top of 141,000 it took there earlier in the year. Bank of America committed to leasing the HBO Building’s entire 366,000 square feet at 42nd Street when HBO moves out. Deloitte grabbed 98,000 square feet at Rockefeller Group’s 1221 Sixth Ave. while keeping its 430,000-square-foot headquarters at Tishman Speyer’s 30 Rock.
Monster renewals were led by AllianceBernstein’s 992,000 square feet at Fisher Brothers’ 1345 Sixth Ave., Cushman found. The largest renewal-plus-expansion deal was by 21st Century Fox, with more than 790,000 square feet at Ivanhoé Cam- bridge and Callahan Capital Partners’ 1211 Sixth Ave.
Sixth Avenue stands apart from neighboring subdistricts in several ways. Times Square’s 2000-era quartet at 42nd Street is younger and more modern, but swamped by hordes of costumed Elmos and tourists.
Although many Sixth Avenue towers date from the 1970s and ’80s, they’re more modern than many in East Midtown. The once-premier zone north of Grand Central is finally on the mend thanks to recent rezoning and to three great, rising projects — One Vanderbilt, 390 Madison Ave. and 425 Park Ave.
To stay competitive, Sixth Avenue landlords are collectively spending hundreds of millions of dollars on new infrastructure, lobbies and public amenities.