The news of the Pfizer vaccine trial helped unleash a huge stock market rally in office REITs, but excessive sublet inventory is becoming the real story. Corporate tenants put a record 42 million SF of space on the leasing market in the second and third quarters, WSJ reported. That increased the total sublease space in the U.S. to a modern record of 157 million SF, or 1.7% of the total office inventory.
- Be Smart: In Manhattan, there were 16.1 million SF of sublease space available during the third quarter. Discounts offered have been more drastic than the typical 20%. There are currently more than 2.5 million SF of sublease space asking under $50 per SF, distributed across 129 buildings.
- New tenants get old fast: Boies Schiller Flexner may depart its new location at 55 Hudson Yards after 18 months. Amid a larger restructuring, the law firm is looking to sublease its 62,250-square-foot space, BI noted.