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Home , 130 William, 14 Wall Street, 161 Maiden Lane, 200 Vesey Street, 250 Vesey Street, 32 Old Slip

OFFICE RETAIL TOURISM & HOSPITALITY RESIDENTIAL MAJOR PROJECTS UPDATE

ALLIANCE FOR DOWNTOWN LOWER REAL ESTATE MARKET REPORT Q3 2018

CHANGE IN OCCUPANCY 2008 - 2018 TAMI 10 pts FIRE 20 pts GOVT 6 pts PROF 3 pts FASHION 1 pt EDU 2 pts HEALTH 1 pt Years After the Financial Crisis, 10 Office Occupancy is More Diverse than Ever. Lower Manhattan’s office occupancy 11, 2001. Most notably, the Technology, companies like the Associated Press, the experienced a dramatic transformation in Advertising, Media and Information sectors Meredith Corporation (formerly Time Inc.), the ten years since one of the worst financial (TAMI) occupy triple the share of space the College Board and J.Crew as some of its crises in history rocked the market. today that they did in 2008 - 5 percent vs biggest occupants. This diversification is also The Finance, and Real Estate 15 percent. A flurry of nonprofit, healthcare, apparent in employment trends. Professional (FIRE) industry’s historic dominance of and professional services companies have Services employment is at its highest level in Lower Manhattan’s office market has given moved to Lower Manhattan helping to grow LM since at least 2001 - 51,332 employees, way to a more diverse tenant mix. Lower these sectors’ share of the office market up nearly 50 percent since the depths of Manhattan’s economy is more vibrant and as well. This transformation is evident in the recession in 2009. Information sector dynamic today than at any time in the buildings across the district. The World Trade employment, which includes jobs in media more than twenty years since campus (One, 3 and 4 World Trade and publishing, is just 5 percent off from creation of the Downtown Alliance. Center) is currently 41 percent leased to its most recent peak in 2001 with 12,083 TAMI companies, a significant shift from the employees today. If you work in Lower These changes have transformed the culture makeup of the original twin towers where Manhattan today, you’re almost as likely to and composition of Lower Manhattan’s office less than 5 percent of space was occupied be working in Information or Professional buildings. According to Jones Lang LaSalle, by these types of tenants. Today, each tower Services as you are in Financial Services or FIRE’s share of occupancy has dropped from in the World Trade Center campus has a Insurance. 55 percent in 2008 to just over a third today TAMI anchor tenant. 195 is nearly (35 percent). Meanwhile, other industries entirely leased to the creative and technology The timeline illustrates the milestones have filled in the gap and then some, helping industries. Brookfield Place, once dominated in Lower Manhattan’s office market to drive private sector employment to by and financial firms such as diversification and the post-2008 economic 243,800, its highest level since September Lynch, Nomura Holdings and others, counts expansion.

RBC J.CREW CONDÉ NAST IEX MEDIAMATH TEACH FOR AMERICA ESPN SPOTIFY SPORTSNET MACMILLAN PLANNED PARENTHOOD LAMDA LEGAL AMEX MEREDITH MCKINSEY & CO MM.LAFLEUR HARPERCOLLINS VOX MEDIA MCGRAW-HILL JONES DAY GROUP M OMNICOM GUCCI BOOKING.COM HUGO BOSS COLLEGE BOARD

Photo: iStock, By Getty Images. Trace Rouda.

Lower Manhattan Real Estate Market Report | Q3 2018 1

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P 4 OFFICE RETAIL TOURISM & HOSPITALITY RESIDENTIAL MAJOR PROJECTS UPDATE

THIRD QUARTER LEASING DIPS BounceX, one of the fastest growing software companies in the AFTER BANNER SECOND QUARTER , signed a deal to relocate from and expand to a 79,118-square-foot office in Following an above average second quarter, new leasing activity in early October. slowed with just 726,000 square feet of new deals inked in the third quarter. With this below-average quarter, year to date NEW LARGE DEALS SCARCE BUT TAMI AND activity is now 24 percent below the level at this time last year. FLEXIBLE SPACE PROVIDERS STILL ACTIVE Despite this, several pending deals announced in the third quarter, but not yet officially closed are expected to boost year- Technology, Advertising, Media and Information (TAMI) and end totals and close the year on par with the historical average. Flexible Space Providers continued to be Lower Manhattan’s Elsewhere in Manhattan, leasing slowed slightly in Midtown and strongest dealmakers in the third quarter, now accounting for Midtown South, but both markets remain on track to best 2017’s more than 43 percent of all new activity year to date. While more year-end totals. active south of Chambers Street than the Midtown market, these industries are currently the majority of new activity in Midtown More than 266,000 square feet of new deals were announced South, accounting for more than 76 percent so far this year. in the third quarter but have yet to close. The NYPD is in negotiations for 106,000 square feet in 375 . Spotify is expected to close on a 85,666-square-foot expansion that will “For us, the decision was simple. bring their footprint in to 564,000 square feet. With this expansion, Spotify will be the largest tenant in 4 All of our clients in digital media World Trade Center and the second largest overall World Trade continue to move down here.” Center campus tenant behind Condé Nast. Also, the Stock Exchange is expected to close on a deal to relocate from -Michael Pallad, President - Undertone Midtown to 75,000 square feet in . Finally,

LOWER MANHATTAN YEAR TO DATE LEASING ACTIVITY, 2013 - 2018 Source: CBRE

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Lower Manhattan Real Estate Market Report | Q3 2018 2 Education, Healthcare & Nonprofit Other Services Government TAMI 2017 New Leasing OFFICE ActivityRETAIL by TOURISM & HOSPITALITY RESIDENTIAL MAJOR PROJECTS UPDATE Fashion & Industry Retail Trade FIRE Professional NEW LEASINGServices ACTIVITY BY INDUSTRY, 2018 YEAR-TO-DATE AND 2017 OVERALL Source: Jones Lang LaSalle

Education, Healthcare Education, Healthcare & Nonprofit Other Services & Nonprofit Other Services Government Government Fashion & TAMI TAMI Retail Trade 2018 Year-to-Date 2017 Flexible New Leasing New Leasing Space Activity by Activity by Providers Industry Fashion & Industry Retail Trade Professional FIRE Services Professional FIRE Services *By square-footage *By square footage

LOWER MANHATTAN TOP LEASES, Q3 2018 Education, Healthcare Source: Downtown Alliance, CBRE, JLL, CoStar, Colliers International & Nonprofit Other Services SF Tenant Name Location Transaction Type Sector LeasedGovernment Professional Services, 1 WeWork 85 76,814 Expansion Fashion & Flexible OfficeT SpaceAM ProvidersI Retail Trade 2018 2 Broadcast Music, Inc 61,390 Renewal Year-to-DateNonprofit Emmet Marvin Flexible New Leasing 3 120 Broadway 53,314 Renewal Professional Services, Legal & Martin LLP Space Activity by Providers Professional Services, 4 Knotel 110 William Street 36,848 New LM LocationIndustry Flexible Providers 5 Rafeal Vinoly 36,550ProfessionalRelocation Professional Services, Design ServicesRenewal and 6 Posse Foundation, Inc 14 36,345 NonprofitFIRE Expansion 7 Cision (PR Newswire) 200 33,866 *By squareRelocation footage TAMI, Media

8 National Debt Relief 180 30,548 Expansion FIRE

9 Undertone One World Trade Center 25,550 Relocation TAMI, Technology

10 Framestore 61 Broadway 24,479 Relocation TAMI, Technology

11 23,041 New LM Location Education

12 PR Consulting Group, Inc 100 Wall Street 19,645 Relocation TAMI, Public Relations Renewal and 13 Fundera 123 William Street 19,051 FIRE Expansion Morris Duffy Alonso 14 101 18,089 Renewal Professional Services, Legal & Faley 15 Barton F Graf 100 Broadway 17,625 Relocation TAMI, Advertising

Lower Manhattan Real Estate Market Report | Q3 2018 3 OFFICE RETAIL TOURISM & HOSPITALITY RESIDENTIAL MAJOR PROJECTS UPDATE

WeWork was especially active Manhattan-wide in the third NONPROFIT AND EDUCATION TENANTS RENEW quarter and announced their new ranking as the largest private AND EXPAND LOWER MANHATTAN ROOTS occupier of space in Manhattan overall with over 5.3 million square feet. In Lower Manhattan, the company has seven Other deals signed this quarter reflect Lower Manhattan’s locations. They signed the largest third quarter deal when ongoing appeal to existing tenants especially in the nonprofit and committing to a 76,814-square-foot expansion in 85 Broad education sectors. Posse Foundation, a nonprofit leadership Street. The 319,000 square foot location is the company’s largest training organization renewed and expanded by 10,000 in Lower Manhattan. Knotel inked the second largest deal of the square feet at . They will now occupy an entire quarter with their plans to open a fourth location in 110 William 36,345-square-foot floor.Pace University signed a lease for Street. The expanding flexible space company signed a lease for 23,041 square feet in 52 Broadway, also home to King’s College, 36,848 square feet on the 17th floor. to expand classroom space for their Actors Studio Drama School. Finally, the Hawthorne School, a school focused on children Lower Manhattan also recorded several smaller relocation and adults with autism and other developmental disabilities, commitments from TAMI companies. PR Newswire, a press expanded by 12,261 square feet in 156 William Street, also release distributor and communications company, will be home to The Blue School. relocating from Hudson Square to 33,866 square feet in at Brookfield Place. They will join Associated Press, a fellow media company, in the building. The World TAMI RELOCATIONS DOWNTOWN Q3 2018 Trade Center remains a draw for technology and advertising companies. Undertone, a digital advertising firm, inked a deal for 25,550 square feet on the 77th floor of One World Trade Center. Framestore, a motion picture visual effects company, is relocating from SoHo to a 24,479-square-foot floor in 61 Broadway. Other recent TAMI relocations signed at 61 Broadway in 2018 include Hello Alfred, a digital personal and home services manager, and Collibra, a data governance platform company.

RAFAEL VINOLY ARCHITECTS JOINS 100+ ARCHITECTURE AND DESIGN FIRMS SOUTH OF CHAMBERS STREET

One of New York ’s most well-known architecture firms,Rafael Vinoly Architects, committed to move to 375 Pearl Street after 28 years in Hudson Square. The designer of 432 will relocate to the 36,550-square-foot top floor in the recently repositioned tower. Lower Manhattan has welcomed a steady stream of architecture and design firms relocating from Midtown South in recent years including CetraRuddy, CallisonRTKL, Morris Adjimi Architects and Cooper Robertson Partners.

TWO OF THE MOST IMPORTANT NAMES IN DIGITAL MUSIC ARE LOCATED IN THE WTC

In the third quarter, Broadcast Music, Inc. (BMI), a music royalty, publishing and licensing organization, signed the largest renewal of the quarter at 7 World Trade Center for 61,390 square feet. The music rights management organization has been located in Lower Manhattan since 2010 after relocating from Midtown. BMI licenses much of the music played by Spotify, which is headquartered in nearby 4 World Trade Center.

Lower Manhattan Real Estate Market Report | Q3 2018 4 OFFICE RETAIL TOURISM & HOSPITALITY RESIDENTIAL MAJOR PROJECTS UPDATE

VACANCY RATE UP TO 12 PERCENT WITH percent, according to Cushman & Wakefield. Nationwide, the CLASS A ADDITIONS overall average vacancy rate among central districts is 12.5 percent, up slightly year-over-year and each Manhattan In the third quarter, the vacancy rate increased slightly to 12 submarket remains tighter than the national average. percent, rising for the third consecutive quarter, according to Cushman & Wakefield. Space additions in properties such as 28 While sublet space has increased in Lower Manhattan over the Liberty and as well as below-average quarterly leasing past year, the market’s sublet vacancy rate of 1.5 percent still activity pushed the rate up from 11.3 percent in the second remains slightly below that of Midtown and Midtown South - 1.8 quarter. percent.

The majority of the largest blocks of space remain in the World Trade Center and the Financial East submarkets, which account for about two-thirds of all available space. With the addition Overall Vacancy Rate of 28 Liberty and 32 Old Slip, the Financial East submarket experienced a 16 percent expansion in available space. Other Lower large blocks in this submarket include (269,764 Manhattan square feet) and 120 Broadway (203,749 square feet). 12% Meanwhile, overall vacancy rates in Midtown and Midtown South 12.5% are basically stable year-over-year. Midtown’s overall vacancy Manhattan rate is down less than a percentage point from this time last 12.5% year to 9.2 percent, and Midtown South is holding steady at 7.4

OVERALL VACANCY BY SUBMARKET, Q3 2013 - Q3 2018 Source: Cushman & Wakefield

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Lower Manhattan Real Estate Market Report | Q3 2018 5 OFFICE RETAIL TOURISM & HOSPITALITY RESIDENTIAL MAJOR PROJECTS UPDATE

AVERAGE ASKING RENT REACHES NEW PEAK rents in Lower Manhattan and Midtown has narrowed to the IN LOWER MANHATTAN WITH STRONG SUPPLY closest point since the beginning of 2004; Lower Manhattan’s OF CLASS A SPACE ON THE MARKET average Class A rent is $15.60 below Midtown’s average. At the same time, the average Class A asking rent for available Lower Lower Manhattan’s overall average asking rent reached a new Manhattan space offers the greatest discount in the market’s peak for the second consecutive quarter as it crept up to $63.70 history as compared to availabilities in Midtown South. Lower per square foot. This rise can largely be attributed to the addition Manhattan’s Class A average asking rent is $26 per square of higher priced Class A space at 28 Liberty and 32 Old Slip to foot below the average asking rent for space on the market in the market. This pushed the average Class A asking rent to a Midtown South. market high as well, reaching $67.20 per square foot, up 6.8 percent year-over-year. Similarly, the average Class B asking rent remains near its historical high at $55.40 per square foot. Class A Asking Rents Lower Manhattan Midtown Midtown South Midtown South trended in the same direction, with its overall average asking rent reaching $76.40, a new historical high for $67.20 $82.80 $93.40 the market and also trumping Midtown’s overall average asking rent for the first time in the markets’ history. Midtown South’s average Class A asking rent jumped 10 percent in the third Lower Manhattan Class A Rents quarter to $93.40 due to the completion of several new Class A office buildings in the Meatpacking/Chelsea area. $15.60 PSF After a strong third quarter of new leasing activity, Midtown Below Midtown overall average asking rent fell due to an influx of lower-priced sublease space entering that market at the same time as direct $26.20 PSF available space is at its lowest level in several years. As a result of these changes, the difference between average Class A asking Below Midtown South CLASS A RENTS BY SUBMARKET, Q3 2013 - Q3 2018 Source: Cushman & Wakefield

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Lower Manhattan Real Estate Market Report | Q3 2018 6 OFFICE RETAIL TOURISM & HOSPITALITY RESIDENTIAL MAJOR PROJECTS UPDATE

THIRD QUARTER PROPERTY SALES The Shapiro Group purchased 21 Park Place, a 9,686-square- foot building, for $9 million or about $929 per square foot, from Lower Manhattan’s property sales market remained subdued in the Lions Group NYC. Most recently, the building has been used the third quarter. as a retail property. Tents & Trails had occupied the base of the building since the early 1970’s before closing earlier this year. OFFICE The new owners plan to redevelop the property but exact plans remain unknown. Lower Manhattan logged two office transactions in the third quarter. The largest transaction was executed for 101 Barclay. MULTIFAMILY The of New York Mellon purchased the land underneath 101 Barclay for $352 million from the City of New York. The In August, Brookfield Asset Management announced (but has not bank has owned the building since the early 1980’s and yet closed on) its purchase of Forest City Realty for $6.8 billion. recently consolidated its 4,500 employees there after relocating This transaction will also include the trade of , operations from Brookfield Place. This marks the largest property a 903-unit luxury rental tower completed in 2012. This deal transaction in Lower Manhattan year-to-date and a strong vote of estimates the value of the rental tower at $520 million or about confidence in Lower Manhattan by BNY Mellon. $576,000 per unit.

Great Empire Realty purchased the Building at 60 Pine Street for $28.3 million or $575 per square foot from the Down Town Association in a sales-leaseback transaction. The 49,000-square-foot office building is fully occupied by the Down Town Association.

HOTEL

Urban Commons, a Los-Angeles based real estate firm, purchased the 298-room Wagner Hotel at the base of 2-10 West Street, for $147.3 million or about $494,000 per hotel room from Westbrook Partners and Millennium Partners. The hotel was previously branded as a Ritz-Carlton Hotel, and Westbrook and Millennium Partners rebranded it to the Wagner Hotel, an independent brand. The rest of the building contains 120 condominium units which were previously branded as Ritz- Carlton residences. This transaction is the third closed hotel transaction in Lower Manhattan in 2018.

RETAIL

After a quiet first half of the year for retail trades, two transactions closed in the third quarter. Maxim Capital Group, purchased a 3,451-square-foot retail condominium at the base of 108 Chambers Street, an 8-unit residential condominium building expected to be complete in mid-2019, from the building’s developer, Greystone Development. The transaction closed at $10 million, valuing the retail space at $2,898 per 101 Barclay Street square foot. The building’s retail condominium is already in BNY Mellon purchased the land operation with Vitamin Shoppe and at the base of the underneath their already-owned building. headquarters at 101 Barclay, signalling their confidence in Lower Manhattan.

Lower Manhattan Real Estate Market Report | Q3 2018 7 OFFICE RETAIL TOURISM & HOSPITALITY RESIDENTIAL MAJOR PROJECTS UPDATE

RETAIL MARKET

New Openings and Announcements Lower Manhattan retail continued to expand in the third quarter of 2018. Pier 17 opened in the Seaport District and a variety of new retailers opened across the district. By the end of 2019, Lower Manhattan will have more than 7.28 million square feet of retail -- an expansion of 2.92 million square feet since 2014.

Westfield World Trade Center recently welcome a second Starbucks and Toytoise, a toy store. Just Baked!, a bakery and sandwich shop, and Gloveworx, a boxing studio, are expected to open by the end of the year. With the June opening of and the surrounding plaza spaces, an entirely new street level restaurant collection is on the horizon. Over 75,000 square feet of retail and restaurant space will open in 2019. Courtesy of Seaport District

At Brookfield Place, popular seafood eatery Seamore’s joined other Pier 17 debuted its concert restaurants along Vesey Street in early July and La Maison du Chocolat series, in partnership with opened overlooking the Winter Garden. Madewell announced it will open this Live Nation, in the Seaport fall. Sant Ambroeus, the fashionable Italian restaurant, is expected to open District. early next year.

The Seaport District had a busy summer with a number of shops and eateries opening. The Pier 17 rooftop concerts by Live Nation began in August to much fanfare, while various pop ups and activations are underway. 10 Corso Como opened a 28,000-square-foot concept shop, the first in the U.S., in the Fulton Market Building. In addition to fashion, design and books, the space includes a cafe and art gallery. Additionally, the SJP Collection, a shoe boutique by Sarah Jessica Parker, and long-term pop-ups by Roberto Cavalli and Cynthia Rowley opened. Big Gay Ice Cream, by CHLOE., a vegan fast-casual eatery, and Cobble Photo by Brett Wood Courtesy of 10 Corso Como & Co., a gastropub, opened along Front Street. Restaurants by Jean-Georges Vongerichten, David Chang and Andrew Carmellini and Malibu Farm are 10 Corso Como opened its expected to open in phases in late 2018/early 2019. first concept shop in the U.S. in the Seaport District. With 27 new retailers opening in Lower Manhattan in the third quarter, the district now has 1,187 stores and restaurants. The eateries and retailers that opened or were announced in the third quarter include:

• Alamo Drafthouse announced it will open its second NYC movie theater in the lower levels of 28 Liberty Street in late 2019. The 40,000-square-foot dine-in multiplex will have 14 screens and a separate bar; •  Chop House, an Asian steakhouse, opened at ; • Ambassador, a Japanese fashion and design boutique, opened at 49 Warren Street in ; Photo by Katie Foster, Courtesy of Seamore’s • QB House, a barber shop hailing from Tokyo, opened at 18 John Street; and Seamore’s welcomed guests • Fast casual eateries continued to expand across Lower Manhattan, to its new Brookfield Place including Taïm at 75 Maiden Lane, The Kati Roll Company at 22 location at . Maiden Lane and Proper Food at 67 Wall Street.

Lower Manhattan Real Estate Market Overview| Q3 2018 8 OFFICE RETAIL TOURISM & HOSPITALITY RESIDENTIAL MAJOR PROJECTS UPDATE

TOURISM & HOSPITALITY

Record Year for Tourism Lower Manhattan continues to be a growing destination for tourists. In 2017, approximately 13.6 million tourists visited Lower Manhattan, up nearly eight percent from 20161. An estimated 17.4 million unique visitors (a figure that includes residents of and the surrounding area who don’t work or live in Lower Manhattan) visited the district in 2017 — a 17 percent increase from 2016. Visitors from throughout the city and the tri-state area were likely drawn to well publicized new destinations such as the Oculus and Brookfield Place. As a whole, New York City welcomed a record number of 62.8 million tourists in 20172. This was an increase of 2.3 million over 2016. Hotels Check-in to Lower Manhattan At the end of the third quarter, there were 7,118 rooms in 33 hotels throughout Lower Manhattan. Three hotels are expected to open Courtesy of AC Hotel New York Downtown before the end of 2018: The AC Hotel New York Downtown opened at • The AC Hotel New York Downtown, at 151 Maiden 151 Maiden Lane with Lane, recently opened in mid-October with 271 rooms. 271 hotel rooms. An The hotel will also feature an independent restaurant to be independent restaurant announced at a later date; will also be at the hotel’s • The Moxy NYC Downtown, at 26 , opened base. in late October with 298 rooms. The hotel also features Recreation, a coworking space by day and cocktail bar by night; and • The Artezen Hotel, will bring 89 hotel rooms to 24 John Street and will have a Ground Central coffee shop at the base. With 12 hotels and 1,900 hotel rooms under construction or in the development pipeline (including the 658 rooms in three hotels expected to open in the remainder of 2018), inventory is expected to increase by up to 27 percent in the next few years. If all projects continue as planned, the hotel inventory in Lower Manhattan will reach 9,019 rooms in 45 hotels by 2020. Increase in

Hotel Rooms in Courtesy of Moxy NYC Downtown Lower Manhattan 27% The Moxy NYC Downtown by 2020+ opened this fall at 26 Ann Street with 298 hotel rooms. The hotel will also feature Recreation, a cocktail bar and 1 Source of Lower Manhattan tourism estimates: Audience Research & Analysis coworking space. 2 Source of New York City-wide tourism figures: NYC & Company

Lower Manhattan Real Estate Market Overview| Q3 2018 9 OFFICE RETAIL TOURISM & HOSPITALITY RESIDENTIAL MAJOR PROJECTS UPDATE

Occupancy and Average Daily Room Rate LOWER MANHATTAN HOTEL DEVELOPMENT PIPELINE Source: Downtown Alliance The third quarter’s average occupancy rate was 87.2 percent -- three percentage points below the citywide average1. The Owner/ Open Hotel & Address Rooms Floors occupancy rate of Lower Manhattan hotels decreased by three Developer Date percentage points from Q3 2017. This is the second consecutive Westbury 1 The Artezen Hotel Realty 89 21 2018 quarter where occupancy has decreased year-over-year, both by 24 John Street Associates three percentage points. While occupancy has trended down, AC Hotel NYC Fortis average daily room rate (ADR) is going the other direction. This 2 Downtown Property 271 26 2018 Group is the second consecutive quarter where Lower Manhattan’s ADR 151 Maiden Lane increased year-over-year. In the third quarter of 2018, ADR in Moxy NYC Tribeca 3 Downtown Associates 298 30 2018 area hotels was $266, up one percent year-over-year. New York 26 Ann Street City’s ADR1, about $20 more than Lower Manhattan’s ADR, also The Fidi Hotel Premier increased slightly, by 2.4 percent year-over-year to $287. 4 11 Emerald LLC 143 27 2019

Marriott 120 5 Residence Inn Lam Group (upper 40 2019 Positive signs on the horizon include growing tourism, expanded 215 Pearl Street floors) retail and restaurant offerings, and new and repositioned Courtyard by 200 office product which are expected to continue to drive business 6 Marriott Lam Group (lower 40 2019 215 Pearl Street floors) and leisure travel to Lower Manhattan. The positive outlook for demand generators and a slowdown in citywide hotel Hotel Indigo Atlas 7 120-122 Water Hospitality 122 31 2019 development are encouraging hotels to push room rates higher, Street despite a modest dip in occupancy year-over-year. Additionally, Hotel Indigo 10-12 efforts to regulate the booming home-sharing industry, including 8 8-12 Maiden Lane MLane Inc. 190 25 2020 legislation recently adopted by the , could reduce the availability of units listed by companies such as Airbnb. Aloft Hotel Fit 9 50 Trinity Place Investment 173 29 2020 This could shift some demand and pricing power back to the hotel Group market especially on key sellout nights. Boutique Hotel Centaur 10 Battery Maritime Properties/ 41 5 2020 Building Cipriani

TBD Hotel Roe 12 11 265 Broadway Corporation 80 (of 42) 2020

TBD Hotel Clarion 12 American Stock Partners/ 174 14 TBD Average Daily Exchange Building GHC Dev. Room Rate in Total Hotels in the Pipeline 12 Lower Manhattan, Total Hotel Rooms in the Pipeline 1,901 $266 Q3 2018 1 Source of New York City-wide hotel figures: CBRE Hotels / STR Hotel Occupancy Rate in Lower Manhattan, 87% Q3 2018

Lower Manhattan Real Estate Market Overview| Q3 2018 10 OFFICE RETAIL TOURISM & HOSPITALITY RESIDENTIAL MAJOR PROJECTS UPDATE

RESIDENTIAL MARKET

Inventory and Development Continue to Expand LOWER MANHATTAN RESIDENTIAL DEVELOPMENT Source: Downtown Alliance Lower Manhattan has over 33,100 units in 334 mixed-use and Address & Lease & Open residential buildings. The estimated population of approximately 61,000 Units Building Name Building Type Date held steady over the past year as several anticipated openings were Condo Units delayed. Across existing residential buildings, approximately 59 percent Under Construction TOTAL 2,069 are rentals, 35 percent are condos/co-ops and six percent have an 1 Condo 24 2018 unknown tenure. Over 2,670 units in 20 buildings are currently under 19 Park Place New Construction construction or planned for development (75 percent condo and 25 2 Condo 99 2018 percent rental). Street Conversion 1 Beekman Condo 3 Street New Construction 31 2019 During the third quarter, three residential buildings with 1,173 units Condo opened and began welcoming residents. Full lease-up and occupancy 4 30 Warren Street New Construction 23 2019 are expected one year from now. They include: Condo 5 81 Warren Street New Construction 12 2019 111 Murray Street - Fisher Brothers and the Witkoff Group’s • 6 108 Chambers Condo 8 2019 62-story, 157-unit condo tower opened in August. The building Street New Construction was the site of a former St. John’s University building; Condo 7 1 Seaport New Construction 80 2019 • 19 Dutch Street - Carmel Partners is starting to wrap up construction on its 64-story, 483-rental unit tower. The Fulton 125 Greenwich Condo 8 Street New Construction 273 2019 Street tower’s first residents moved in this summer and the Condo building will continue to open in phases throughout the next 9 45 Park Place New Construction 50 2019 twelve months; and 10 23-31 Condo 110 2019 • 20 Broad Street - MetroLoft’s conversion of a 27-story office New Construction building adjacent to the welcomed 69 West 11 Condo 24 2020 its first set of residents in September. The building will have Broadway New Construction 364 rental apartments and 169 short-term rentals operated 77 Greenwich 12 Street Condo 90 2020 by Sonder, a hospitality company. In addition, there will be Former Syms site New Construction 70,000 square feet of retail. Full occupancy is expected in the 13 One Wall Street Condo 566 2020 next 14-18 months. Conversion 14 Condo 244 2020 Two additional buildings are expected to open before year’s end: Street New Construction Condo 15 New Construction 206 2021 • 19 Park Place - The narrow 21-story, 24 condominium tower, 75-83 Nassau Rental/Condo developed by ABN Real Estate, is wrapping up construction 16 Street New Construction 229 2021 and expects a temporary certificate of occupancy in late 2018; Condo & Rental Units In TOTAL and Development 606 • 49 Chambers Street - The Chetrit Group’s conversion of Hotel/Condo 1 267 Broadway New Construction 37 2020 the the historic Emigrant Savings Bank anticipates closings to Rental begin this November, adding 99 condo units to the market. 2 185 Broadway New Construction 279 2021 Rental 3 86 Warren Street New Construction 40 TBD 3 Platt Street Rental 4 102 John Street New Construction 92 TBD TOTAL UNITS IN THE PIPELINE 2,675

Lower Manhattan Real Estate Market Overview| Q3 2018 11 OFFICE RETAIL TOURISM & HOSPITALITY RESIDENTIAL MAJOR PROJECTS UPDATE

Residential Rental Market Metrics According to residential statistics published by Miller Samuel/Douglas Elliman, the median rent in Lower Manhattan increased slightly to $3,795, up 1.5 percent from this time last year. Meanwhile, Manhattan’s overall median rent also trended up slightly, at 0.9 percent year-over-year to $3,445.

Residential Sales Market Cools Slightly Continued fluctuation and correction in the residential sales market in Lower Manhattan reflected the expiration of the legacy contract pipeline for condos, as well as rising mortgage rates and downward pressure from the recent tax overhaul. Similar trends are being seen across Manhattan overall. Fisher Brothers & the Witkoff Group’s The median sales price for co-ops and condos dropped to $931,500, down 62-story 111 Murray Street opened nearly 7.5 percent from last quarter and 30 percent from the previous year. with 157 condo units. This is the first time since the first quarter of 2016 that the median sales price fell below $1 million. Similarly, while Lower Manhattan’s average price per square foot (PPSF) of $1,285 saw a decrease of ten percent over the past quarter, the year-over-year decrease was around 28 percent.

The Blue School Expands The Blue School, an independent private school founded by members of The Blue Man Group, has expanded into an additional space at 156 William Street, a few blocks west from the original 241 Water Street location in the Seaport. The new, four-story, 45,000-square-foot space serves students in the 4th through 8th grade and Carmel Partners opened its 64-story, features flexible classrooms, library, STEAM lab, 483-unit rental tower at 19 Dutch a gymnasium that doubles as an auditorium and Street this past summer. commons area with a microgreens garden. The original 241 Water Street location now serves pre-K through 3rd grade. The new expansion will allow the school to double its capacity to 600 students over the next decade.

Metroloft’s conversion of 20 Broad Street into 533 rental units welcomed Photo by Albert Vecerka/Esto for the Blue School its first residents in early fall.

Lower Manhattan Real Estate Market Overview| Q3 2018 12 OFFICE RETAIL TOURISM & HOSPITALITY RESIDENTIAL MAJOR PROJECTS UPDATE

LOWER MANHATTAN MEDIAN RESIDENTIAL RENT, 1Q 2015 - 3Q 2018 Source: Miller Samuel/Douglas Elliman

LOWER MANHATTAN MEDIAN CONDO SALES PRICE, 1Q 2015 - 3Q 2018 Source: Miller Samuel/Douglas Elliman

This was the first time since 2016 that median condo sales prices fell below $1 million.

Lower Manhattan condo sales are returning to normal patterns as the LOWER MANHATTAN AVERAGE SALES PRICE PER SQUARE FOOT (PPSF), 1Q 2015 - 3Qluxury 2018 legacy contracts Source: Miller Samuel/Douglas Elliman empty.

Lower Manhattan condo sales are returning to normal patterns as the luxury legacy contracts empty.

Lower Manhattan Real Estate Market Overview| Q3 2018 13 OFFICE RETAIL TOURISM & HOSPITALITY RESIDENTIAL MAJOR PROJECTS UPDATE

MAJOR PROJECTS UPDATE

WTC Cortlandt 1 Station Reopens 74 Trinity Place The WTC Cortlandt 1 Train station officially reopened after being destroyed Trinity Real Estate’s 74 Trinity Place, a new 26-story, 310,000-square- on September 11, 2001, forcing trains to bypass the station for over 17 foot office building, has begun to rise. The bottom five floors will be years. The remodeled station features a white, monochromatic marble for community use, floors six through eight will be used for Trinity mosaic with text from the 1776 Declaration of Independence and the Church’s offices and the remaining 17 floors will be rentable office 1948 United Nations Universal Declaration of Human Rights. The station space. The existing pedestrian bridge across Trinity Place will remain opens directly into the west side of the World Trade Center Transportation and eventually be reconnected to Trinity Church. The $350-million- Hub. Separately, entrances from the new 3 World Trade Center tower into tower is expected to open in 2020. the transit hub are expected to open by the end of next June. NYC Ferry Expands Service The Ronald O. Perelman Performing Arts Center The final two of the six NYC Ferry routes launched this summer at the World Trade Center (The Perelman Center) with service to the and Soundview (Bronx). The The Ronald O. Perelman Center for Performing Arts at the World Trade other routes include the pre-existing Ferry service and Center, known as The Perelman Center, signed a 99-year lease with lines to the Rockaways, South Brooklyn and Astoria. These new the Port Authority in February 2018. The Center has raised $295 routes have proven popular, as ridership hit 4.8 million cumulative million, or 82 percent of its expected $363 million construction cost. In riders since the service launched in May 2017. Due to the better conjunction with the lease signing, the Port Authority will also receive than anticipated demand, additional funds have been allocated to $48 million from the Lower Manhattan Development Corporation for pay for larger boats, a second home port and other infrastructure below-grade construction. upgrades to accommodate increased rider projections. Additionally, the board of directors of the Perelman Center announced These routes have 20 landings across the city, including a newly- the appointment of its first artistic director, Bill Rauch of the Oregon announced homeport landing at the Brooklyn Navy Yard that will Shakespeare Festival. be part of the East River Route. All routes stop at Pier 11-Wall The approximately 110,000-square-foot cube-shaped building will Street. One-way tickets cost $2.75. feature three theaters of varying sizes, which can be combined in different seating configurations and formats for an array of unique performance environments. The Perelman Center will be located at the site of the now demolished PATH entrance at Greenwich and Vesey Curious About Ongoing Construction? streets, which closed when the World Trade Center Transportation Hub opened in summer 2016. The project began construction in fall 2017 The Downtown Alliance continues to educate our constituents and anticipates opening for the 2020-2021 season. about ongoing construction developments throughout Lower Manhattan beyond our quarterly real estate reports. LM3D MTA Reopened the New WTC Cortlandt Station, gives planners, investors, residents and all neighborhood Bringing the 1 Train Back to stakeholders an unparalleled way to visualize the development the World Trade Center taking place in Lower Manhattan. LM3D’s tools allow users to search for information on an individual building, a select area or to analyze land use across the neighborhood. New on our website are a series of development maps that are divided by geography and include addresses, estimated height, potential uses and expected completion date for individual projects. These maps also highlight ongoing public construction projects. They include (links below): • Fulton Street area • Greenwich Street South area • New York Stock Exchange area

Courtesy of the Metropolitan Transportation Authority • World Trade Center & Greenwich Street North area

Lower Manhattan Real Estate Market Overview| Q3 2018 14 Visit www.downtownny.com/research-statistics for additional publications on the Lower Manhattan real

estate market and economy. Documents include a complete list of residential and hotel developments,

available retail spaces, a summary of leasing incentives and other research reports, including:

Lower Manhattan Real Estate 2017 Year in Review, an annual real estate report providing a review of commercial office, retail, residential, hospitality and development projects happening in 2017.

Lower Manhattan: New York City’s Premier Transit Hub, a report demonstrating the strength of Lower

Manhattan as one NYC’s premier multimodal hubs and needs/opportunities for future improvements.

An Untapped Market: Lower Manhattan’s Young Professionals, a residential survey highlighting Lower

Manhattan as a neighborhood of choice for young professionals in New York City, as well as ways to capture residents’ robust appetite for dining out and entertainment.

Surging Ahead: Lower Manhattan’s Economic Revival and What It Means For New York, a report on the major advances in Lower Manhattan’s economy expected over the next five years as a result of post-September 11th investments and the area’s status as a burgeoning center for some of New York City’s highest value, most dynamic industries;

The Brain Gain, 2015 Report, an updated report on how the region’s shifting demographics continue to favor the Lower Manhattan Business District. Previously released in 2012, the updated data shows an even stronger trend;

TAMI Takes Lower Manhattan, a report on the growth of technology, advertising, media, and information companies moving south of Chambers Street;

Everything Old is New Again: Conversions of Historic Properties in Lower Manhattan, a report on historic properties preserved through significant investment and changes in use;

The Golden Age of Transit in Lower Manhattan, a report released on ’s opening, describing how the more than $6.4 billion of transit investments made since 2005 benefit a large and growing labor force;

Alliance for Downtown New York 120 Broadway Suite 3340 New York, NY 10271 212.566.6700 DowntownNY.com Telephone: 212-835-2787 Email: [email protected]