**Manhattan Office Leasing Rallies in Strongest Q1 Since 2018**
Manhattan’s office leasing market experienced a significant rebound in the first quarter of 2025, marking the strongest first-quarter performance in years. Multiple real estate brokerages reported an upswing in activity, highlighting renewed demand in one of the world’s premier commercial hubs.
According to Avison Young, Manhattan posted a total of 10.1 million square feet in leasing volume during Q1, representing the highest first-quarter total since early 2018. Savills further emphasized the strong performance, calling it the best quarter overall since Q4 2019.
One of the notable trends was the increase in large-scale lease transactions. Avison Young tracked 14 leases exceeding 100,000 square feet, while Savills recorded 16. This growth was largely driven by firms in the banking, finance, insurance, and real estate sectors—collectively accounting for nearly half of all leasing activity.
Manhattan’s office market also saw improvement in vacancy rates. JLL reported a decrease in total vacancy by 22 basis points quarter-over-quarter, bringing it down to 15.8%. A significant factor in this recovery was the decline in sublease vacancy, which dropped by 56 basis points to 3.2%, as sublet leasing volume neared the one million square foot mark.
A standout deal from the quarter was Santander renewing its U.S. headquarters lease at 437 Madison Avenue, covering nearly 192,000 square feet.
These figures signal optimism for Manhattan’s commercial real estate market, with industry sectors showing renewed confidence in the city’s long-term office space needs.
