6th Avenue has regained the title of Midtown’s No. 1 office rental corridor, as measured by lowest vacancy rates. It’s the latest change in leadership in the never-ending bragging rights battle with Park Avenue.
Colliers reported that 6th Street’s fourth-quarter occupancy rate was 11.5% of available space, the lowest of any Midtown corridor and just ahead of Park Avenue’s 11.8%.
This busy edge, now referred to only by tourists as “America’s Boulevard,” may not matter much. But every time we say something nice about Six, we expect the Park Avenue landlord to be displeased.
We do it, and not just because it’s the home of the New York Post. Although the world considers “Park Avenue” to be synonymous with Gotham’s power and wealth, many still see 6th Avenue as an office mecca similar to Park, and 5th Avenue retail stores. It lacks the excellence, the charm of Madison Avenue, the bright lights of Broadway.
We consider it our duty to correct them.
In CBRE’s latest study, Park Avenue leads with just 9.8% availability, while Manhattan overall has about 20% availability. However, brokerage firms often produce slightly different data depending on what is included in the sample and how far into the future they measure availability.
Colliers’ Michael Cohen and Franklin Wallach believe Sixth Avenue’s lowest vacancy rates are not only better than Park Avenue, but have remained so since the onset of the pandemic in 2020. are doing.
Sixth Avenue is “historically better than other areas of Midtown,” Wallach said.
Sixth’s vacancy rate has averaged 11% since the second quarter of 2022, while Park’s vacancy rate has increased since the second quarter of 2021, when a few large tenants relocated to the west end, according to Colliers. rose to 17.5%.
However, Park has since narrowed the gap to almost the same level.
The doldrums that plague FiDi, parts of Midtown South, and Midtown Third Avenue are nowhere to be found in Park or Sixth Avenue.
Both thoroughfares have the advantage of new or recent construction coveted by major tenants (e.g. 425 Park Avenue and One Vanderbilt on Park, One Bryant Park and 7 Bryant Park on Sixth). Older properties on both main streets have been redesigned and modernized at great expense.
17 blocks of prime Park Avenue space is the focus of $32 billion in public and private investment.
According to advisory firm Weitzman Associates. This includes the $4 billion JPMorgan Chase headquarters tower currently under construction.
But Sixth is enjoying a new lease of life of its own, as owners reinvent midcentury real estate, much like the Rockefeller Group did with the former Time + Life tower at 1271 Sixth. And Sixx could be the largest single new lease in 2023 — law firm Paul Weiss’ move to Fisher Brothers’ 765,000 square feet at 1345 Sixth.
Meanwhile, Colliers’ Mr. Cohen points to a lesser-known strength of 6th Avenue.
“I think the biggest difference between Sixth and Park is that Sixth has somehow become an acceptable alternative to Midtown South for tech companies,” Cohen said.
These include its largest tenant to date, SalesForce (1095 Sixth), Global Relay USA (1155), Indeed.com (1120), and Take-Two Interactive (1133).
Cohen said many of them were attracted to the location’s proximity to Bryant Park. He said, “When I was working on finding an expansion base for Global Relay, [from a much smaller space in Midtown South]”Their instructions to us were ‘Bryant Park,'” he said.
Six Still is best known for what Cohen calls “volatile” industries, such as finance and law. But it is also home to major media companies such as News Corp., the Post’s parent company, and Fox Corp., as well as Cushman & Wakefield, one of Colliers’ competitors.
Sixth Avenue isn’t exactly cheap, but with average asking rents of just over $82 per square foot compared to just over $90 psf at Park, it may seem like a bargain to some tenants. Wallach pointed out.
