The Future Is Happening in Commercial Real Estate
In 2015, technology, advertising, media, and information (TAMI) companies gobbled up nearly half of all leases in Midtown South.
Today, the number’s closer to one-third.
It’s true that the 1.6 million square feet TAMI companies leased in Midtown South last year was the lowest level since 2010, as the Commercial Observer points out.
But that’s not because there’s been a mass exodus of TAMI companies from the district.
These fast-moving and agile companies are just opting for more flexibility.
So far, in 2018, TAMI’s locked into a little more than 200,000 square feet in Midtown South. This puts them on pace to lease half the space they did last year.
This isn’t because TAMI companies are disappearing, either — quite the contrary.
It’s because the market is flipping.
In the age of flexibility, long-term leases are quickly becoming a thing of the past.
And small leases are vanishing altogether.
Instead of locking into leases, TAMI businesses are becoming Knotel customers. Just ask companies like Cheddar, Stash, and Teachable, which moved from a WeWork facility in Brooklyn to a Knotel in Manhattan’s Flatiron District.
This trend will only accelerate as we move further into the future.
Knotel has secured nearly 25% of the 450,000 square feet leased in Midtown South this year. By the end of 2018, we expect we’ll have locked down an additional 1 million square feet there.
And we plan on securing even more space in 2019 and beyond.
As more and more leases end, an increasing number of TAMI companies will look for flexible office spaces that are customized to meet their unique needs.
That’s when they’ll find Knotel.
Add it all up, and eventually we’ll get to the point in the future where there will be zero lease activity in commercial real estate.
Knotel will control all of the supply and it’ll never trade hands.
Buckle up. The future has officially arrived.