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nvestors, including Blackstone and high-net-worth individuals, are actively seeking office properties in New York as companies bring employees back to the office, sparking a nascent recovery in the commercial real estate market. This trend could signal a broader economic rebound for major cities worldwide, driven by workers returning to offices five days a week and boosting demand for local services.

    After years of investors shunning empty commercial spaces following the pandemic, demand is rising for top-quality offices in New York, prompting more deals. Amazon's search for space, BXP's talks with tenants for new buildings, and Blackstone's growing optimism on the sector are among the bullish signs. Blackstone President Jonathan Gray sees compelling value in offices in New York City and San Francisco, citing growth in financial services firms and undervalued tech hubs.

    Blackstone had significantly reduced its office exposure in recent years, but now accounts for less than 2% of its real estate holdings, down from over 60% in 2007. Consultants report that investors struck more office deals last year as lease terms improved and tenants became more active. Blackstone is reportedly eyeing a large stake in the Manhattan office building at 1345 Avenue of the Americas.

    While distress still exists for older buildings with limited appeal, economic growth and lower interest rates are driving demand for offices. Senior industry executives agree that the world is moving back to in-person work, citing the benefits of real estate as an interest-rate-driven financial asset. BXP Inc.'s chairman and CEO Owen D. Thomas notes that his company is in talks with anchor tenants to build a 46-story tower in Midtown Manhattan.