The NYC Real Estate Market is Improving.  Is now the Time to Act?

Below are the 10 stats that speak to the improving state of the office market and NYC economy as of January 2025:

1. 2024 Year-End Leasing Activity was 24% higher than 2023.
   ➡️ For more insights into recent leasing activity, check out Manhattan Office Market Roars Into 2025.

2. The Availability Rate for Manhattan stands at 18.5%, its lowest in 3 years. (To provide additional context, in 2019 it was 11.2%.)
   ➡️ Explore how availability rates are tightening in Manhattan Office Figures February 2025.

3. Sublease Availability is down 23% from its all-time high of February 2023.

4. Subway Ridership is at 77% of 2019 figures, and Rail Ridership is at 90% of 2019 levels.

5. Midtown Better Buildings have an availability rate of 9.9%.
   ➡️ Learn more about the performance of Midtown’s premium office spaces in The Strength of Manhattan’s “Better Buildings” in the Midtown Core.

6. Large Tenants: There are currently 119 requirements with tenants looking for 50,000 sq ft or more, totaling 22.9 million sq ft (compared to 18.6 million sq ft in 2018/19).

7. The Taking Rent Index inched back to 93% of the asking rent, still below its pre-pandemic levels of 95%.

8. Conversions: Approximately 21 million sq ft of office space is at various stages of conversion away from office use.
   ➡️ For insights into office-to-residential conversions and their impact on the market, read The Latest on Manhattan Office Conversions: A New Era for NYC Real Estate.

9. NYC office-using employment is at 100% compared to pre-COVID levels.

10. Air Traffic Passengers are at 105% of pre-COVID levels.

Market Trends and Insights

The office market continues to improve and evolve. While remote and hybrid work remain part of workplace strategies, more companies are pushing for a return to work, and major corporations such as Blackstone, Apple, Amazon, Bloomberg, and IBM continue to expand their real estate footprint.
It is also clear that both for-profits and nonprofits are demanding higher-quality office products with easier access to transportation for their employees. As vacancy rates in Midtown decline, other neighborhoods are starting to see spillover effects.
With office conversions on the rise and less desirable office space being removed from inventory, all signs point to a market that will continue to improve and tighten.

➡️ For nonprofits navigating this evolving market, explore Things for Nonprofits to Consider When Leasing Office Space.

I would welcome the opportunity to learn about your company’s or organization’s occupancy objectives and offer my thoughts and strategies.

Please feel free to reach out.
Paul Walker
212-984-7117
Paul.Walker@cbre.com