All posts tagged: square foot

New York Will Be Fine. Other Downtowns Have More to Fear.

New York Will Be Fine. Other Downtowns Have More to Fear.

“Urban doom loop.” “Office real estate apocalypse.” Today, anyone who reads business news has seen dire predictions for America’s downtown commercial towers, which emptied out when the coronavirus arrived and remain under-occupied three and a half years later. Most coverage centers on the most expensive big cities, such as New York. But the focus on glittering superstar cities is misguided, because many more fragile downtowns—the likes of Dayton, Ohio; Birmingham, Alabama; and St. Louis—entered the pandemic with little margin for failure. Even Minneapolis, with a strong overall labor market, faced a high office-vacancy rate in 2019. Still more commercial space emptied out during the pandemic, and foot traffic downtown has waned. “It’s spooky,” one retail clerk told The Wall Street Journal. To be sure, Manhattan office investors and their lenders certainly have plenty to lose, because participating in that market was so expensive to begin with. According to the 2023 outlook from the commercial-real-estate company Colliers International, asking rents for downtown Class A office space in Manhattan are $81 a square foot per year, down …