Adam Dunn

"Is Sixth Avenue the new Park Avenue?” The Q4 earnings calls are in, and some of NYC’s biggest landlords are making this comparison. SL Green Realty Corp. said, "Sixth Avenue is exhibiting leasing and rent growth dynamics similar to Park Avenue." With vacancy in "better buildings" on the avenue tightening, prices are rising and there is fierce competition for space on the avenue. Discussing Sixth Avenue, Steve Roth, CEO of Vornado Realty Trust, said 1290 Avenue of the Americas is "the single best building on the Avenue," backed by a $45M hospitality-driven renovation. Their capital investment has proved successful, with major leases by Oaktree Capital Management, L.P., Portage Point Partners, Linklaters, and others. In addition to the above completed deals, there are large pending deals on the Avenue for 100,000 sq. ft.+. Space that isn't even being publicly marketed has significant activity. Sixth Avenue deserves the praise it's getting. #commercialrealestate #realestate #officespace #leasing

42

3 Comments

2025 closed with one of Midtown’s strongest performances in years. Below are highlights from CBRE's Q4 2025 Midtown Manhattan Office Market Report (in plain English). TL;DR: High-quality space is in high demand and getting harder (and more expensive) to secure. My advice: Whether you plan to stay or move, starting your search early, aligning on your priorities, and building leverage with landlords by exploring the market is more important than ever. Reach out if you'd like the full report or to talk through what these trends mean for your company. 📈 Leasing Demand Surged - Q4 leasing was 36% above the 5‑year average. - Full‑year leasing was its highest since 2018. ➡️ Translation: Tenants are active. Competition, especially for quality space, remains high. 🏢 Availability Shrinking Fast - Availability rate dropped to 13.4%, its lowest quarterly level since Q2  2020. - Midtown has logged 6 straight quarters of positive absorption, the strongest run ever recorded. ➡️ Translation: Fewer options are hitting the market, and good space is getting harder to find. 💼 Flight‑to‑Quality Still Driving Decisions - 77% of deals >50,000 SF landed in top‑tier “Better Buildings.” ➡️ Translation: Companies continue to upgrade into high‑quality assets, driving scarcity at the top of the market. 🏷️ Asking Rents Edged Up, But It’s a Two‑Tier Market - Midtown average asking rent rose to $84.24/SF (+1% QoQ, +3% YoY). - Premium buildings tell a different story: Core Better Buildings now average $119/SF, up 14% since 2021. ➡️ Translation: Commodity space keeps overall averages flat, but true Class A is seeing real rent growth. 🔁 Renewals Are Rising - 1.86M SF of renewals in Q4, the strongest of the year. ➡️ Translation: As quality supply tightens, many tenants are choosing to stay put and negotiate. 🛠️ Concessions Remain Historically High - Cash for build-outs and free rent remained high. - Since 2019, average build-out allowances have increased 48%, and average free rent has increased 20%. ➡️ Translation: Even in a tightening market, landlords are still aggressive with concessions, helping offset rising rents. 🧱 Development + Conversions Will Reshape Supply - Two office projects delivering in the next 12 months (520 Fifth & Rolex HQ). - Meanwhile, 3.31M SF of active office‑to‑residential/alternative‑use conversions + more planned. ➡️ Translation: New high‑quality product is limited, while older stock is shrinking.

10