NEW YORK – Oct. 10, 2025 – Manhattan’s office leasing market continued its strong run in the third quarter of 2025, with new leasing reaching 7.3 million square feet (msf)—well above the historical average and marking the third consecutive quarter of elevated activity. According to Cushman & Wakefield’s Q3 Manhattan Office MarketBeat, year-to-date (YTD) new leasing totaled nearly 23 msf, up 37.6% from the same period in 2024, further positioning 2025 to be one of Manhattan’s strongest leasing years since 2019.
“Manhattan’s office market continues to show resilience and depth of demand,” said Lori Albert, Tri-State Research Director at Cushman & Wakefield. “Class A leasing has reached historic levels, driven by tenants gravitating toward modern, high-quality office environments, where hospitality elements are encouraging employees to come into the workplace. The combination of sustained leasing activity and a meaningful decline in sublease availability has pushed vacancy to its lowest point in more than two years.”
Class A properties led the surge, accounting for 17.9 msf of leasing through the first nine months of the year—the highest January-to-September total over 30 years. Large-block transactions remained a defining feature of the market, with 10 new or expansion leases exceeding 100,000 sf completed during the quarter. Combined new and renewal leasing activity totaled 29 msf YTD, a 27.5% year-over-year (YOY) increase.
As leasing activity continued to outpace new supply, Manhattan’s overall vacancy rate fell by 50 basis points to 22.0%—its lowest level since April 2023. Sublease availability declined for the fifth straight quarter to just under 15 msf, nearly 7 msf below year-ago levels. After two quarters of negative absorption, YTD net absorption turned positive in Q3 2025, totaling 4.1 msf.
Average asking rents across Manhattan rose modestly to $72.81 per square foot, while Class A asking rents climbed to $81.89 per square foot. Midtown South led rent growth with a $1.75 increase to $83.06 per square foot, supported by new high-end deliveries including One High Line at 500 West 18th Street. Midtown rents were steady at $75.58 per square foot, while Downtown asking rents ticked up modestly to $56.40 per square foot.
Looking ahead, Cushman & Wakefield expects Manhattan’s strong leasing momentum to continue through year-end, supported by a limited construction pipeline, a decline in sublease space, and growing tech-sector demand.
“The strength of leasing activity and investor interest underscores the enduring value of Manhattan’s office market,” Albert added. “As high-quality product continues to lead performance, we anticipate continued rent stability and further improvement in occupancy.”