News.

Weekly Market Report - January 28, 2021

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Fifth Avenue Retailers See Signs of Budding Revival

With Donald Trump’s tenure in the White House over, store owners are looking forward to fewer disruptions from protesters and fewer police barricades near Trump Tower, which nearby store owners say have had a dampening effect on their business. Retailers also anticipate that the rollout of the Covid-19 vaccines will help bring back tourists to New York City, where Fifth Avenue has been a must visit for many. Asking rents have also tumbled about 18% from their 2017 year peak. That is helping attract new retailers or enticing existing ones to grab more space. “Retailers should be happy,” said Adelaide Polsinelli, vice chair of the commercial investment sales and leasing division at a brokerage firm. Luxury watch and jewelry maker Chopard recently signed a new lease for the Crown Building opposite the Tiffany & Co. store. Toy maker Lego AS moved to a bigger store on Fifth Avenue, where it will occupy 10,000 square feet, or more than double its previous space. ***

Tishman Speyer’s half-empty Hudson Yards tower tops out

The Spiral, Tishman Speyer’s 1,041-foot-tall tower across from the Hudson Yards megaproject, is getting closer to completion. The 2.85-million-square-foot office building at 66 Hudson Boulevard, between 34th and 35th streets, recently marked its topping out, the New York Post reported. It’s expected to be completed in the third quarter of 2022. But finding tenants to fill the building is slow going in the pandemic-battered office market. Nearly 50 percent of the space in the Bjarke Ingels-designed skyscraper has not yet been leased, according to the publication. ***

WeWork dumps several Manhattan locations

WeWork recently exited several leases in Manhattan as the company eyes turning a profit by the end of the year — and a potential public offering via a special-purpose acquisition company. In recent weeks, the company closed and exited four locations in Midtown, Soho and the Meatpacking District, a WeWork spokesperson confirmed to The Real Deal. It’s also relocating members from a fifth location in Midtown where the company is in discussions with its landlord about the space. “Over the last twelve months, WeWork has continued to rationalize its global real estate portfolio as a part of the company’s plan to achieve profitability,” the spokesperson wrote in an email. “With an abundance of supply in the market, we have worked with our landlord partners to rightsize our footprint across New York City where we will continue to provide our members with unmatched space, service, and flexibility. ***

Construction activity dips for fourth straight year: REBNY

Construction activity in New York City declined for the fourth straight year in 2020, according to a new report from the Real Estate Board of New York — although activity picked up in the last quarter with several big new projects. Just 1,760 new building plans were filed in 2020, the lowest number the city has seen since 2012, representing a nearly 10 percent decline from 2019’s total. The total square footage of 42.67 million, down 28 percent year-over-year, was also the lowest figure in that time span. The number of multiple dwelling units declined 18 percent to 27,402. ***

M&T Bank reports ‘significant increase’ in bad real estate loans

M&T Bank reported what it called a “significant increase” in dud commercial real estate loans, a sign that the damage done by the pandemic is starting to infect lenders. The bank, a key player in New York’s pre-COVID-19 construction boom, said Thursday that nonperforming hotel loans rose by $530 million during final 90 days of last year. Management did not identify which loans went bad but said the hotels tend to be located in large cities. Signature bank also reported similar worries but made a comment along the lines saying they think they have enough money on hand to cover the loans.

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