New York City investment sales saw a 10 per cent decline in the second quarter of 2026, according to Avison Young's latest real estate sales report. Despite this quarter-on-quarter drop, the city's commercial real estate market is significantly outpacing 2025. For the entire first half of 2026, New York City investment sales rose by 60 per cent year-on-year, as capital markets and office financing recovered. This led to an increase in transaction numbers and dollar volume across Manhattan, Brooklyn, Queens, and the Bronx, with Staten Island not included in the data collection.
The geopolitical and economic turmoil that characterised early 2026 was palpable, as quarterly sales volume citywide fell from $5.68 billion to $5.42 billion. Beyond this short-term noise, however, the market is in a welcome recovery cycle. The report forecasts an annual sales volume of $22.87 billion for 2026, close to New York City’s 10-year average of $23.4 billion.
Brandon Polakoff, Principal and Head of New York City Investment Sales at Avison Young, compared the city's recovery path since 2023 to the years following the global financial crisis, which peaked for New York real estate investment in 2015. He emphasised that the market is working in the right direction year by year.
Manhattan recorded a total of 94 sales in the second quarter of 2026. Volume was largely led by Extell Development's $451 million acquisition of 405 Park Avenue in May. Other significant transactions included Sovereign Partners' purchase of 575 Fifth Avenue for $378 million and the sale of 250 West 57th Street to Namdar Realty Group for $280 million.
The development site segment proved to be a standout asset class in Manhattan in the second quarter, according to Polakoff. The number of sales increased year-on-year from three to thirteen, with a total volume of $707 million. Polakoff pointed to the difficulty of acquiring existing multi-family properties and the comparatively higher attractiveness of realising 99-unit rental properties to circumvent the wage requirements of the two-year state 485-x multi-family incentive programme. Manhattan's office market accounted for the largest dollar volume for the quarter at $1.51 billion. Compared to the first six months of 2025 – a year marked by economic and election-related uncertainties – the total dollar volume of office property sales rose by 110 per cent year-on-year to $3.3 billion. Multi-family sales in Manhattan also exceeded 2025 by triple-digit percentages, though sales continue to be segmented between prime properties and all others. The dollar volume for this sector fell by 18 per cent quarter-on-quarter to $880 million.
The annual increases and quarterly declines should be viewed in the overall context. James Nelson, Principal and Head of U.S. Investment Sales at Avison Young, explained that transactions closed in the second quarter were negotiated in the first quarter. The first quarter of 2026 was characterised by a rise in 10-year Treasury yields and the start of US military actions against Iran, to which buyers in Manhattan responded accordingly. Particularly noteworthy is that the share of private buyers in Manhattan's sales volume rose by 53 per cent. According to Nelson, private buyers utilise market uncertainties to act proactively, while institutional investors may adopt a wait-and-see approach. Simultaneously, foreign buyers accounted for only 9.7 per cent of Manhattan's sales volume in the first half of the year, a ten-year low. However, the number of foreign sellers has not surged, indicating that these owners are more likely taking a wait-and-see position rather than a complete market exit. Despite many negative macroeconomic factors, the fundamentals from a microeconomic perspective are exceptionally strong, Polakoff noted.
