Lower Manhattan Real Estate Overview, Q1 2025
The Alliance for Downtown New York’s quarterly report provides data on commercial office, retail, residential, hospitality and development projects from Q1 2025. Major findings include:
Downtown Leasing Activity Increases to 1.42M sq. ft., District sees Positive Absorption for Fifth Straight Quarter
Leasing activity rose to 1.42M sq. ft. in the first quarter of 2025, marking a substantial year-over-year and quarterly uptick. This total was driven in large part by Jane Street Capital’s 984,000 sq. ft. renewal and expansion. The district also saw positive net absorption for the fifth quarter in a row, as well as a high number of relocations to the district (5) – one less than the entirety of 2024.
Vacancy Continues to Improve, Asking Rents Continue to Decline
Vacancy fell to 23.9% by the end of the first quarter, making it the fifth quarter in a row of declining vacancy. The year-over-year decline of one percent makes it the largest year-over-year improvement since 2020. The Class A rate also improved, falling by 2.2% over the year to 21.8%. Overall asking rents fell to $55.04, widening the district’s price advantage over the other office submarkets. Also, while the rent figure has been in a state of decline, the trajectory over the past year has avoided any extreme price volatility.
Tourism Rises in 2024, Average Daily Room Rates (ADR) and Occupancy Post Superb Q1 Performance
Lower Manhattan posted the highest Q1 ADR on record with $230. It was 22% above the 2019 figure as well. This quarter also marked the second highest Q1 occupancy rate on record, 77%, making it one percent below the record in 2018 (78%). With respect to ADRs and occupancy, the hotel industry has not only recovered from the pandemic, but begun to outperform prepandemic figures as well. Additionally, the Alliance, in collaboration with Audience Research Analysis, recently completed a tourism and visitorship study that reported a total of 9.3 million tourists in the Lower Manhattan area – up 300,000 compared to 2023.
24 Retailers opened in the first quarter, including the long-anticipated Printemps at One Wall Street
By the end of the first quarter the district saw 24 retailers open up shop. The addition of fast casual places like Tacos No. 1, as well as upscale restaurants and bars such as La Noxe at 111 Broadway and Tulum-based Gitano NYC at Pier 17, have enriched the district’s waterfront and dining offerings. But the most enriching of all was the arrival of French retailer Printemps – a multifloor shopping destination that combines luxury fashion with numerous bars and restaurants.
Read the report below, or download a PDF .