More Tech Subleasing
Commercial Observer
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Tech leasing has been one of the few bright spots in the U.S. office leasing market the past three years. As other industries shed space or paused in taking more, tech companies signed up for new offices in major markets such as San Francisco and New York. That has changed dramatically, and the latest figures underscore the new trend. Also, building non-subsidized, market-rate housing in fast-growing urban areas — especially multifamily housing — is often next to impossible. A debate in Arlington, Va., shows why.
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— Tom Acitelli, Co-Deputy Editor
More Tech Firms Putting Up Offices for Sublease in NYC and SF
New York City and San Francisco landlords are dealing with an increase in tech tenant vacancies after the industry buoyed the leasing market during the pandemic. Office leasing from the tech industry has been on the decline due to layoffs, remote work and a lack of venture capital funding. Tech vacancies in Lower Manhattan hit 23.7 percent and Midtown South was at 19.2 percent in the fourth quarter of 2022, according to data from Savills shared exclusively with Commercial Observer. For both sections of Manhattan, that constitutes a 22.5 percent and 18.4 increase in tech vacancies, respectively, compared to the fourth quarter of 2021. In the same period in 2019, tech leasing made up about 40 percent of new leases in Manhattan, but as of the last quarter amounts to only 5.9 percent, according to Savills.
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Housing's Missing Middle: A Debate in Arlington, Va., Magnifies the Challenge
Living amid an inordinate number of government suits, PhDs and Amazon employees, residents of Virginia’s Arlington County have long boasted of the Arlington Way. Equal parts civic sloganeering and backslapping, the concept celebrates how careful debate and decision-making have shaped the county into a dynamic urban village. A charged, ongoing debate about zoning reform that would permit small, multistory, multi-unit buildings in single-family neighborhoods has stretched that civic comity to its breaking point. It’s reinforcing fault lines between owners and renters that mirror local battles across the nation over housing affordability and political power. The county board’s Missing Middle study, which informed a proposal for zoning reform in 2021, has metastasized in recent months into a blitz of yard signs, influence campaigns on the NextDoor App, and a series of passionate meetings featuring limits on speakers due to the overwhelming demand to testify. Opponents flash signs reading “ the Arlington Way has gone astray,” and county officials get into “no, you grow up”-level exchanges with constituents. Assistant clerk to the county board David R. Barrera said he’s spent at least three hours a day, every workday, for the last six months processing and sharing resident feedback with the board.
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