Q1 2025 Manhattan Market Report

The Manhattan Office Market Records Big Gains As Optimism Grows

Through the first quarter of 2025, the Manhattan office market is enjoying a winning streak. The past 12-months have recorded the best year of new leasing since the onset of the pandemic. There is healthy competition for space in Trophy buildings as occupiers are actively pursuing space in high-quality buildings near mass transit.

The Plaza District and Grand Central submarkets are performing particularly well, with leasing activity at or near pre-pandemic levels. This urgency is related to the scarce amount of construction activity, limiting the amount of space coming online during the current development cycle. Nevertheless, the sheer amount of overall space on the market, (particularly older, unrenovated buildings) is resulting in landlords still willing to negotiate on leasing terms.

The longer-term outlook is cautiously optimistic because of New York’s volume of financial and legal occupiers, along with a growing tech center, may boost demand during a time when many employers are increasing attendance requirements.