Manhattan office leasing surges

Watch on YouTube ↗  |  January 06, 2026 at 19:33  |  1:59  |  CNBC
Speakers
Diana Olick — CNBC Real Estate Correspondent

Summary

CNBC's Diana Olick reports that Manhattan office leasing in Q4 was the strongest in six years, driven by return-to-office trends, tech and AI hiring, flight to quality, and major tenant expansions. Leasing rose more than 25% quarter over quarter, and full-year volume was the highest since 2019. Supply remains above pre-pandemic levels but is being absorbed, and rents are finally rising slightly, though the market is not completely out of the woods and Class A space is leading.

  • Manhattan Q4 office leasing was the strongest in six years.
  • Leasing rose more than 25% quarter over quarter and 16% year over year.
  • Full-year leasing volume was the highest since 2019, just over 2% below pre-pandemic.
  • Drivers include return to office, AI-related tech hiring, flight to quality, and tenant expansions.
  • Available office supply is still about 37% above March 2020 levels.
  • Supply has fallen from the February 2024 peak and is tightest since November 2020.
  • Rents are finally rising a little, but the market is not fully recovered.
  • Class A office is leading via flight to quality.
Ideas
Diana Olick CNBC Real Estate Correspondent 0:25
Manhattan office market is recovering
Manhattan office leasing in Q4 was the strongest in six years, driven by continued return-to-office, increased tech hiring especially for artificial intelligence, tenant flight to quality, and sizable expansions by major tenants. Leasing rose more than 25% quarter over quarter, demand was 16% higher year over year and about 52% above the five-year quarterly average. Supply remains 37% above pre-pandemic levels but is below the February 2024 peak, oversupply is slowly being absorbed, and Manhattan now has the tightest supply since November 2020. Rents are finally rising a little, though the market is not totally out of the woods yet.
Manhattan office real estate HIGH
Diana Olick CNBC Real Estate Correspondent 1:44
Class A office demand leads
Within Manhattan office, the flight to quality continues to favor Class A space. Tenants are seeking higher-quality buildings to attract and retain talent, supporting Class A demand even as the broader market still has excess supply.
Manhattan Class A office MED
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This CNBC video, published January 06, 2026, features Diana Olick discussing Manhattan office real estate, Manhattan Class A office. 2 trade ideas extracted by AI with direction and confidence scoring.

Speakers: Diana Olick  · Tickers: Manhattan office real estate, Manhattan Class A office