York Property Company
Corporate Real Estate | Tenant Representation

Office Sublease Space Availability on the Rise

Twitter’s New York City headquarters totaling 200,000 square feet has been listed for sublease with CBRE. The latest move is in line with recent cost-cutting decisions enacted at the social media giant.

While creative companies across the tech, media and advertising sectors have been placing office space in sought after destinations onto the sublet market for some time, Twitter is the latest high-profile entrant in the arena.

In the New York office market, the total amount of available sublease space has increased from 16 million square feet in 2019 to 25 million square feet by the end of 2022, with an additional 2 MM square feet on the market YTD.

Weakness across the sector is partially to blame
for venture capital deal value across the U.S. experiencing a 30% decline from the prior year.

While the Big Apple's office market continues to grapple with increasing amounts of sublet space, the rate of growth has been starker across the country.

"The sublease inventory increase in the current cycle has been far greater, exploding from 121 million square feet at the end of 2019 to 245 million at the end of 2022," said Phil Mobley, CoStar’s national director of office analytics, of the U.S. office market.

“Particularly with Fortune 1000 users, we are seeing a flight to quality, said Jeff York, President of York Property Company, a long time Tenant Rep advisor based in Dallas. “As leases roll over, many large tenants are searching for Class A assets with more amenities in order to attract and retain employees, while shrinking their office square footage. While their footprint of space may shrink, their actual real estate occupancy costs are remaining level,” York said.

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