Cushman & Wakefield Releases Fourth Quarter Industrial and Office Statistics for Long Island

Long Island Experienced Robust Demand for Industrial Properties, while Overall Office Leasing Rebounded from Q3

Long Island, NY – Cushman & Wakefield, a leading global real estate services firm, today released its fourth quarter 2023 industrial and office statistics for Long Island, showing robust demand for industrial properties and a rebound in overall office leasing activity from Q3 2023.

“Long Island’s industrial market is overall healthy and experienced robust demand in the fourth quarter and a substantial rise in asking rents,” said Dimitri Mastrogiannis, Senior Research Analyst at Cushman & Wakefield. “The demand for quality industrial product is evident, as we saw the largest number of new industrial developments delivered in a single year this year since 1988.”

Long Island’s industrial market experienced robust demand in 2023, with quarter-over-quarter leasing activity rising 4.8% in the fourth quarter and year-to-date deal volume totaling 3.8 million square feet (msf). The development pipeline grew as nearly 2 msf of industrial product was delivered this year, causing new supply to outweigh demand and year-to-date absorption remaining at negative 242,000 sf. While the vacancy rate climbed by 90 basis points to 4.3%, the largest quarter-over-quarter increase since 2015, direct average asking rents for industrial properties continued to rise substantially to $18.43 per square foot (psf).

“While many office markets across the country experienced an extreme slowdown in leasing activity, Long Island experienced a substantial rebound in the fourth quarter and year-to-date. While vacancy is still in the double digits as occupiers continue to adapt to the evolving workplace, Class A properties continue to see demand and asking rents have remained stable,” added Mastrogiannis.

Fourth quarter new leasing activity in Long Island’s office market experienced a substantial rebound since last quarter, up 38.7% with the year’s total up 3.4% year-over-year. While the overall vacancy rate rose significantly, up 60 basis points since last quarter to 14.4% due to increases in both Nassau and Suffolk County, the direct average asking rent remained stable, declining $0.07 psf from last quarter to $32.78 psf. Year-to-date net absorption remained negative as five spaces above 30,000 sf, all within Class A buildings, became available this quarter.