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'Silicon Alley' Is Manhattan's Commercial Real Estate Hotspot

Tuesday, July 10, 2012

A new report shows Midtown South — home to Silicon Alley's start-up scene — is the hottest commercial real estate market in the city.

The vacancy rate in the area stands at 6.1 percent — significantly lower than the 9.8 percent rate in midtown Manhattan and the 9 percent Manhattan average, according to commercial real estate broker Cushman and Wakefield. 

The Midtown South area includes the neighborhoods of SoHo, Greenwich Village, Madison and Union Squares, Hudson Square, NoHo, Chelsea and the West Village.

Information, technology and media companies made up about a third of all new commercial leases in the area in the last year.

"Google started this with what I call the Google effect," explained Andy Peretz, an executive vice president at Cushman and Wakefield. "Which is taking almost 1 million square feet for yourself in a 3 million square foot building. Then everybody else wants to be around you."

Google purchased an 18-story building in Chelsea in December 2010.

Education and apparel companies have also moved into the area. NYU and JCPenney both signed lease deals in Midtown South in the second quarter.  NYU is currently in the process of trying to get approval to expand its campus in the Greenwich Village neighborhood.

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Comments [3]

eshita from DHAKA

If you are trying to sell a home, it is important that you market for home in all sorts of avenues. If you only advertise through a for sale sign, you will find it very difficult to sell your home. Make sure you advertise on the internet, in newspapers and through other creative avenues.

Jul. 25 2012 05:54 AM
Commercial Real Estate from Detroit

Great article

Jul. 11 2012 01:59 AM
Inquisigal from Brooklyn

"Hottest" really means "most aggressively priced," let's call it what it is, shall we? The real story should be about all of the long-time businesses in these buildings that have been asked to leave because they don't fit into the desired price point of this new Silicon Alley. I was just at a July 4th party at a business in that building who has been there for 20+ years, and who will be moving out in the fall. I only hope that the Brooklyn Navy Yard or another similar cluster of former factory buildings can become a welcome and affordable center for former west Chelsea arts-oriented businesses and manufacturers. I'm curious - why do programers at Google and designers from JC Penney need industrial loft spaces with high ceilings and natural light? What a waste of space.

Jul. 10 2012 05:25 PM

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