May 08, 2025
New York City’s real estate market just hit a major milestone—commercial properties helped drive real estate tax revenue to a record $37 billion in 2024.
That’s nearly half of the city’s local tax income, and projections show that number climbing to $40 billion this year. As a broker, I can tell you this underscores just how critical real estate—especially commercial—is to the city's financial engine.
What’s wild is that this surge is happening even while offices are still figuring out their post-COVID identity. The office vacancy rate remains high, yet values in the sector are holding strong thanks to areas like Hudson Yards, which continue to pull weight and attract premium tenants.
While Midtown East and Times Square used to be the crown jewels, it’s clear that the momentum is shifting west.
And the return-to-office conversation? Still evolving. A new report shows 1 in 4 employers plan to tighten attendance policies this year. Right now, 57% of Manhattan office workers show up on any given weekday.
That’s not full capacity, but it’s inching closer to pre-pandemic norms. The hybrid work model is holding strong, but the shift in workplace expectations could give the commercial market a boost in the long run.
Despite all the noise around the “death of the office,” the numbers tell a different story. Commercial properties—offices, retail, hotels, and manufacturing—have consistently made up the lion’s share of tax revenue alongside large multifamily buildings.
From 2019 to 2024, these two sectors accounted for a whopping 76% of NYC’s property tax income.
commercial buildings still anchor New York City. As brokers, investors, and property owners, we need to stay dialed in on this space. Whether you’re holding, buying, or repositioning, commercial isn’t going anywhere—it’s just evolving.
Disclaimer: This content is meant for informational purposes only and is not intended to be construed as financial, tax, legal, or insurance advice.
