The strength of the Manhattan office leasing market can seem like old news, until impressive new metrics emerge just about every week.
Demand is so great that premier office buildings are running out of available space, according to Cushman & Wakefield.
It found that direct availability at 32 trophy towers comprising 42 million square feet shrunk over the past two quarters to only l.7 million square feet, or 4.4 percent of the trophy inventory.
The available space compared with 3.5 million square feet in the first quarter of 2025 and 6.6 million sf in the same period of 2024.
Cushman said the office recovery is no longer mainly measured in terms of a shrinking supply of sublease space, but by demand for direct leases, renewals and expansions. Growth by tech sectors including AI is a major driver of the trend.
Meanwhile, according to CBRE, leasing volume in May alone totaled 3.02 million square feet, or 43% above the five-year monthly average of 2.10 million square feet. It marked only the second time since 2019 that the 3 million benchmark was topped in a single month.
The largest deals in May included Versant Media’s 249,054 square-foot renewal and expansion at 229 W 43rd St.; Baker & McKenzie’s expansion to 122,000 sf at 452 Fifth Ave.; and CV Starr’s 93,020 R&E at 343 Madison Ave.
Also in May, Simpson Thacher & Bartlett took 916,000 square feet at Extell’s 570 Fifth Ave. — much more than it was earlier reported to want.
In fact, the market’s been on fire since Jan. 1. As we previously reported, law firm Cleary Gottlieb renewed on 475,000 square feet at Brookfield Properties’ One Liberty for 20 more years. HDR engineering signed for 74,000 square feet at 7 Penn Plaza, formerly known as 370 Seventh Ave.
The top-tier market will likely tighten even more, as no new product is due to come online for several more years.