New York City Office Space Attracts Numerous Green Energy Companies

According to CBRE, New York City is witnessing the emergence of a new trend as the state of New York commits over $55 billion to source 70% of its power from renewable energy by 2030 and achieve a zero-emission electric sector by 2040. The CBRE Brief titled “NYC’s Energy-Related Leasing Rises in Response to State’s Transition to Renewables” highlights the influx of green energy firms to the city and their expansion of operations to take advantage of the green energy transition, as well as the city’s access to talent and improved investment climate.

“These are the early days, but energy-related leasing is definitely a growing trend to keep a close eye on over the next few years,” said CBRE’s Ben Friedland, who arranged leases for climate and green energy companies in Manhattan last year.

David Stockel, who also arranged recent leases for green energy companies in New York City, added, “While still in its infancy, the energy-related leasing trend in NYC shows similar signs of growth as the tech sector 15-20 years ago and life sciences more recently.”

In 2022, a record 13 energy-related firms, including nine renewable companies, signed leases. This followed a strong year in 2021 when 10 energy-related leases, seven of which were renewable firms, were signed. In 2023, eight energy-related firms, all renewable, signed leases in NYC.

CBBE played a key role as the tenant representative in two lease transactions completed last year with firms involved in the state’s renewables transition. One of these transactions involved Transmission Developers, a Blackstone portfolio company that is developing a fully buried transmission line from the U.S.-Canadian border to New York City, and leased 14,000 sq. ft. of space.

Additionally, investment firms that provide capital for renewable energy infrastructure projects across the state and globally have leased 400,000 sq. ft. in Manhattan. Twelve of these firms hold all-renewable portfolios. Energy-related investment leasing reached 165,000 sq. ft. across 10 transactions in 2023, reflecting the state’s advancing energy transition programs. CBRE served as the tenant representative in four of the lease transactions completed last year, including Stonepeak’s lease of 77,000 sq. ft. in December 2023.