In New York City, the Lease is Up – and Now, so are Your Corporate Housing Prices!

In Manhattan in 2010, you could rent an unfurnished apartment for $2,500.00 per month, as many of New York’s most luxurious apartment buildings were desperate to find tenants and were offering generous incentives to lure them in.  During this time, corporate housing costs were equally affordable.

Fast forward to 2012, and we find ourselves in an entirely different situation.  Across New York, rents have not only rebounded from the depths of two years ago, but are also beginning to surpass the record high levels of 2007.  New lease rates for the same unit may increase up to $5,000.00 per month, and tenants are now forced into the marketplace to look for new apartments which they can afford.

How does this new reality affect your corporate housing costs?  You guessed right— as rental prices increase, so does the cost of corporate housing in New York City.  But there is another challenge: the availability of corporate housing inventory is decreasing as well!  The current rental vacancy rate in New York City is hovering around 1%, and the best units are taken within days.

As rental market demand has increased, the shorter-term leases typical of the corporate housing industry have become less attractive to landlords who find themselves holding all of the cards.  As corporate housing leases end, they are being subject to higher premiums, if they are being renewed at all.  In this climate, proactive corporate housing providers are taking a good look at their inventories to ensure they are maintaining units in areas that are in demand for both you and your transferees.

How can SIRVA help?  By utilizing our own unit inventory as well as leveraging our suppliers through our electronic bidding process for each assignment, SIRVA’s corporate housing team is ideally suited to keep these market driven cost increases to a minimum.  As always, SIRVA will continue to monitor the realities of the corporate housing marketplace, from New York City to Seattle, and will keep you both informed and equipped with the best solutions available to meet our your business needs.

Contact us today for assistance with your corporate housing program.

This post was co-written by David Strate and Terri Williams.