New York City

With footfall in New York City stepping back up to pre-pandemic levels, there’s optimism in the corporate occupier fit-out market. Reflecting the trend across the wider North American region, clients are on the hunt for Grade-A space, but the inventory of this quality is limited in key New York neighbourhoods, which is driving investment to optimise and right-size existing portfolios. High demand mixed with the limited pool of top-tier contractors means premium fit outs now average at US$547 per ft2, the highest ranking in our global comparison.

The lack of new available space is leading many clients towards retrofitting their existing offices. There’s also an added consideration due to Local Law 97 which aims to cut the emissions and embodied carbon associated with buildings over 25,000 ft2 in the city. Fit outs must now prioritise high-efficiency heating and cooling systems, smart and energy-efficient lighting and controls, and sustainable and green materials. Refurbishment inherently limits the carbon impact of upgrading office space by avoiding demolition and making use of the existing structure. Conversely, the cost of bringing existing non-Grade-A buildings up to the law’s specifications can be significant, and this investment will likely see costs passed down via leases and rents to occupiers with tenants responsible for energy and sustainability performance of their fit-out projects.

There is no one-size-fits-all approach, and major new offices and fit-outs are still relatively frequent – especially in the financial services world, which is driving many of new fit outs across the city. JP Morgan opened its new 60-storey headquarters on Park Avenue at the end of last year after choosing to expand into a new, bespoke space, while American Express has just broken ground on their new HQ in Downtown New York and Deloitte’s new HQ at Hudson Yards is gathering pace.

In New York, we are also seeing technology companies driving activity. These tech occupiers tend to opt for fit outs that allow them to attract and keep people in the office – from sleep pods to luxuries like golf simulators – and offering many of the trappings of home life in the office space.

These amenity-heavy spaces aren’t just reserved for tech though. Legal, financial and professional services firms are all increasingly compromising on desk density to ensure their fit outs offer competitive attractions for workers.