Lower Manhattan Experienced Strongest Year of Office Leasing Since 2019 

In 2025, Lower Manhattan’s office market rebounded strongly, according to the Alliance for Downtown New York’s year-in-review report on the neighborhood’s real estate market. Boosted by a strong fourth quarter, the downtown office market doubled 2024’s leasing total and posted its best numbers since 2019. Furthermore, relocation activity to Lower Manhattan showed significant improvement compared to recent years, with more companies moving to the district.  

In the fourth quarter, Lower Manhattan reported 1.57 million square feet of new leasing, pushing 2025’s total to 4.75 million square feet. That is double the leasing total of the prior year, making it the most active year for the office market since 2019. The vacancy rate finished the year at 22.2%, down 2.1% from Q4 2024.

“Last year was a robust one for office leasing in Lower Manhattan. Frankly, it was also a great year for tourism, retail and residential growth. We hope that this energy and momentum will continue into 2026 and beyond,” Downtown Alliance president Jessica Lappin said.

Several large tenants re-committed to the Lower Manhattan in 2025, including Jane Street Capital, which signed a 984,000 sq. ft. expansion and renewal in Q1 at 250 Vesey St.; BNY Mellon, which signed a 192,915 lease in Q2 at One World Trade Center; and Moody’s which signed a 457,733 sq. ft lease at 200 Liberty St. in Q4. Furthermore, new movers to Lower Manhattan accounted for 592,000 square feet of the year-end leasing total, a fivefold increase compared to last year. 

Q4 2025 also marked the eighth consecutive quarter of positive net absorption, with 821,000 square feet exiting the market. This brings the year-end absorption total to 2.02 million square feet. This is largely due to the residential conversion boom in the neighborhood. Over the past two years, 14 new residential conversion projects have been announced, accounting for at least 3,200 units.The many conversion projects have been largely responsible for Lower Manhattan’s residential population exceeding 70,000 for the first time. In 2025 alone, the population increased by 3,900 people. 

Lower Manhattan logged 90 retail openings in 2025, a 38% improvement from 2024, with just  24 closings. While a high percentage of new openings were from the food and beverage sector, 2025 saw the opening of the much anticipated French shopping, dining and wellness destination Printemps at One Wall Street. Also of note, indoor sports facility Socceroof opened its doors at 28 Liberty St., showcasing a creative retail use for a former office space. Buzzy new restaurant openings in 2025 included Gitano at Pier 17, Fogo de Chão at 40 Cortlandt Way and Quick Eternity at 22 Peck Slip. The neighborhood also welcomed the newest and largest outpost of Barcade, a retro arcade bar, at 10 Corlandt St. 

Meanwhile, hotel and tourism numbers continued to show strength for the year. Lower Manhattan saw hotel occupancy rates reach 90% in Q4, the quarter’s highest mark on record. The neighborhood also ended the year with the highest average daily room rate on record at $384.93. The hotel inventory in Lower Manhattan currently stands at 7,928 rooms across 41 hotels.

Read the full report here.