M
anhattan's office market is experiencing a resurgence, with leasing volumes surging to levels not seen in years. According to Colliers, tenants signed 3.7 million square feet of deals in August, a 20% increase from July and well above the city's 10-year monthly average. This momentum could lead to over 40 million square feet of commitments by the end of 2025, a milestone last achieved in 2019.

    Franklin Wallach, executive managing director at Colliers, attributes the surge to low unemployment and renewed interest from industries that slowed during the pandemic. The return to office is also driving demand, as well as the reemergence of key industries like tech. Amazon has been a major player, signing over 1 million square feet of space since late 2024.

    The legal sector is also on the rise, with law firms inking over 4 million square feet in 2023 and volumes still topping 2019 benchmarks. Much of the action is clustering in Manhattan's newest towers, where demand has outpaced supply. The "flight to quality" trend has tightened availability in these newer buildings, pulling Manhattan's overall rate down to 15%, its lowest since early 2021.

    Rents are also on the rise, with asking prices climbing 1% in August to $74.73 per square foot. Landlords are beginning to push their numbers higher, and conversions are reshaping the market. Nearly 9 million square feet of offices have been removed from the market over the past four years, leading to a shift towards more expensive sublet spaces.

    For now, the market looks steadier than it has in years, with demand rising, supply tightening, and even the city's priciest addresses filling up again.