Manhattan Office Market Surges Beyond Pre-Pandemic Levels
In a first, new leases for initial six months of 2025 surpass some years leading up to pandemic
The Manhattan office market is showing remarkable strength, with new leasing in the first half of 2025 surpassing levels seen in many years before the pandemic. CoStar reports that 15.8 million square feet of new office space was leased during this period, a 14% increase over the same period in 2024 and exceeding most first-half totals from 2016 to 2019.
Focus on Quality
- Tenants continue to prioritize top-tier office buildings.
- The largest new leases have all been signed in four- or five-star properties.
- Availability in Manhattan’s trophy buildings has dropped sharply from 17% to 10.7% since early 2023, while comparable national markets have seen minimal change.
Prime Locations Drive Demand
- Midtown Manhattan remains the epicenter of leasing, with seven of the 10 largest new leases located there.
- Proximity to major transit hubs, including Penn Station and Grand Central, gives Midtown a key advantage by connecting employees from New Jersey, Connecticut, Long Island, and Westchester efficiently.
Despite broader economic concerns and slower job growth, Manhattan’s office market remains resilient, fueled by high-quality buildings and strategic locations that continue to attract major tenants.