NYC Office Sublets May Increase in 2018, says CBC Advisors New Partner
Abdo Optimistic That Industry Has What it Takes to Tackle Midtown East Building Obsolescence
Corey Abdo has been promoted to partner at the New York City office of Coldwell Banker Commercial Advisors (CBC Advisors).
Abdo, an industry veteran with 30 years of experience in commercial real estate and more than 5 million square feet of completed transactions, sees an increase in Midtown East office sublets in 2018 as tenants continue migrating west and downtown. But he says 2018 is not necessarily grim.
"I think we will start seeing more sublet space coming online in 2018 as a result of the flight to quality, especially in the Park Avenue properties, as tenants move to newer space downtown at the WTC complex or to the West Side Yards. This will result in some vacancies, but as the space is already leased it won't affect net absorption rates, until those leases actually expire," Abdo notes.
Overall, the office market is very healthy, he adds. Tenants are becoming more efficient, adjusting to fit into the tightest envelope of space. Nevertheless, it remains a landlord's market, Abdo contends.
"I think there was a little bit of softening in the first and second quarters, with increased landlord concessions. But that was not a major market adjustment and things settled down. The economy is still strong and the stock market is a rocket ship," he says.
As talent moves west, there's been some apprehension about the fate of older buildings in the Midtown East submarket. Abdo does not see cause for alarm though, pointing to L&L Holding's 425 Park Avenue development as an example of reinvigorating the submarket.
"In terms of the situation with building obsolescence and concern of what to do about older assets, L&L Holding is leading the way in this type of work with its 425 Park Avenue project," he says, adding there will be, "Plenty of capital available to renovate these older Park Avenue buildings. I don't think that should be cause for concern. There are very creative people in our industry and there's always someone willing to take a calculated risk. Investors still want their dollars sleeping in New York City concrete."
What's Next for CBC Advisors?
CBC Advisors is focusing on the 10,000-50,000-square-foot tenant, a niche that the company feels is underserved, according to Abdo.
"Our intention is to bring full-scale corporate advisory services to this tenant group," he says.
Abdo will help facilitate CBC's growth in this area, working alongside partners Catherine O'Toole and Greg Gang.
Prior to joining CBC Advisors, Abdo spent 12 years at Winoker Realty, where he focused on growing landlord and tenant relationships and was eventually promoted to partner. After selling that business in 2014, he joined CBC Advisors and served as executive managing director of leasing and sales. Abdo began his real estate career in 1986 when he joined Newmark & Company, working at the firm's West Side office for 17 years.
Commercial real estate is actually Abdo's second career. He started out in the music business playing in a rock-and-roll band through high school and college. After graduating with a bachelor's degree in economics, he worked in music production for five years, also producing jingles for TV ads.
"You can be creative, but it is a different kind of creativity," said Abdo about how a penchant for creativity is the common thread that helped him make a seamless switch to commercial real estate. "What I love the most is that every situation is different. Every tenant, every landlord is different. This business is the ultimate multitasker's paradise. I enjoy that aspect of it."