Manhattan’s property market made a powerful comeback in 2025, with total investment sales below 96th Street reaching $22.77bn. That represents a 45 per cent increase compared with 2024 and marks the borough’s strongest year since 2018.
Office buildings led the recovery. Sales of office properties more than doubled, rising 126 per cent to $11.29bn. Investors showed strong interest in high-quality, well-located towers, particularly in Midtown and SoHo. One of the biggest deals was the $1.08bn sale of 590 Madison Avenue. A major corporate transaction involving eight Class A office buildings, valued at about $3.8bn, also significantly boosted total figures.
This renewed confidence was supported by improved leasing activity. Businesses signed leases for nearly 42m square feet of office space in 2025, the highest level since before the pandemic. Availability rates fell and asking rents in prime Midtown buildings climbed, with top-tier offices commanding premium prices. In contrast, older Class B and C buildings saw sharp price reductions, with some properties trading at discounts of more than 60 per cent compared with their pre-pandemic values. These sales reflect a reset in expectations for less competitive office stock.
Development activity also increased. Sales of development sites totalled nearly $4bn, driven by new rental projects, condominium developments and office-to-residential conversions. Tax incentives and zoning changes encouraged investors to repurpose outdated office buildings into housing. Multifamily investment remained steady at $3.44bn, with buyers favouring buildings that are not subject to rent regulation. Regulated properties continued to see lower valuations.
Retail property showed signs of improvement as well. Transaction volume rose 31 per cent, supported by strong demand in prime shopping corridors such as SoHo and Fifth Avenue, where rents increased as available space tightened.
Overall, Manhattan’s property market entered 2026 with renewed momentum, supported by stronger leasing, selective investor confidence and policy measures encouraging redevelopment.
