August 26, 2025
New York City’s commercial real estate market is showing serious signs of life. After a tough couple of years, 2024 marked a massive rebound with over $28 billion in investment sales, a 26% jump from 2023.
While much of the country is still finding its footing, NYC is pulling ahead—driven by three key asset classes: Office, Development, and Multifamily properties. Together, they made up 70% of all investment sales.
Here’s what’s driving this surge and what it means if you’re eyeing commercial real estate opportunities in NYC.
NYC’s office market came roaring back with $5.4 billion in sales, a 63% increase. But here’s the catch—Class A office buildings are doing the heavy lifting.
High-end corporations (think hedge funds, law firms, financial giants) are scooping up premium office spaces in amenity-rich buildings that support a “club-like” corporate vibe. These aren't your outdated cubicle farms; they're brand-new trophy towers.
Big players like JP Morgan, Rolex, and Citadel are even building 8 million square feet of their own new office space. On the investment side, we’re seeing deals like SL Green’s One Vanderbilt sale at $2,800/SF, showing that international capital is still hungry for prime Manhattan addresses.
But it’s not all glitz. Class B and C office buildings are being sold at steep discounts (11% to 73% off) as vacancies rise. Opportunistic investors are swooping in, seeing value in repositioning these assets for future conversions.
Development site sales hit $5.5 billion, up 53% from last year. A big reason? Office-to-residential conversions. Older office buildings, especially Class B and C, are being scooped up for redevelopment into apartments, retail, and hospitality spaces.
Two factors are making this play extremely attractive:
Deals like Related’s purchase of 625 Madison Avenue and Extell’s 655 Madison Avenue are clear signals that developers are betting big on this trend. With tax incentives like the new 485x program and zoning bonuses, expect more underutilized office buildings to turn into much-needed housing.
The multifamily sector closed $8.9 billion in sales across 1,107 deals, a 14% increase. The real action is in free market properties, which now make up 63% of all multifamily sales volume.
Why the rush? Prices have dropped about 28% from peak levels, but rents in prime areas are up 20% over the past three years. That’s a golden formula for investors. Major players like Silverstein, Carlyle, and Stonehenge are leading the charge, especially in Brooklyn and Manhattan.
Rent-stabilized assets, on the other hand, are trading at deep discounts (29% to 68% off their last sale prices), catching the attention of family offices and private buyers hoping for regulatory changes or conversion opportunities.
Affordable housing is also staying active, with public-private partnerships driving major deals like Knickerbocker Village and Beacon Mews.
As we head into 2025, several trends are set to shape NYC’s commercial real estate landscape:
For buyers, sellers, and investors, the window of opportunity is wide open—if you know where to look.
