Weekly Market Report - December 23, 2025

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Manhattan’s top office leases of 2025

NYU, Jane Street crack the 1M sf mark

New York's office leasing sector rebounded in 2025, highlighted by JP Morgan's new $3 billion headquarters at 270 Park Avenue, marking a significant shift from the pandemic. Major lease transactions returned, with Manhattan on track to exceed 40 million square feet in deals, the highest since 2019, while availability dropped to 14.2%, the lowest since late 2020. Key leasing highlights of the year included New York University, securing 1.1 million square feet at 770 Broadway, evolving it into a hub for engineering and technology.

Jane Street Capital expanded to 1 million square feet at 250 Vesey Street, necessitating Brookfield to relocate its corporate offices. Deloitte signed for 800,000 square feet at 70 Hudson Yards, showcasing a demand for high-quality spaces. Citadel took 504,000 square feet at Brookfield's 660 Fifth Avenue and plans to anchor a new development at 350 Park Avenue. The United Nations consolidated offices at 2 United Nations Plaza, while Horizon Media, Guggenheim Partners, Universal Music Group, Amazon, and Salesforce also secured substantial leases, reflecting a strong office market comeback.

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MTA to sell 350K sf of air rights in Lower Manhattan

Agency releases RFP for Fulton Center rights

The MTA is seeking bids for over 300,000 square feet of development rights in Lower Manhattan, specifically for up to 350,000 square feet of landmarked air rights associated with the Fulton Center. The Fulton Center shares a zoning lot with the landmarked Corbin Building, which is underbuilt by 358,000 square feet, with the MTA retaining 8,000 square feet for future needs. Eligible buyers must acquire rights via City Planning Commission certification or through a zoning lot merger, and proposals necessitating special permits or land-use approvals will not be accepted.

The City of Yes for Housing Opportunity initiative has broadened eligible buyers by easing landmarked air rights transfer rules, allowing square footage application to nearby sites without triggering special permits, provided the increase does not exceed 30 percent of the receiving site's allowance. Larger projects still require special permits and city review. The demand for air rights has surged post-City of Yes, with landmarked rights trading between $180 and $400 per square foot. Bidders must submit offers reflecting fair market value as determined by the MTA’s appraiser, with proposals due by March 16, 2026.

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New York's biggest office landlord plans to sell off $2.5B of property

SL Green, New York's largest office landlord, is set to sell approximately $2.5 billion in Manhattan properties to address high interest rates. Founded in 1980, the company holds a portfolio of 30 million square feet primarily in Midtown. Next year’s sales will be countered by over $1 billion in acquisitions. CFO Matthew DiLiberto expressed frustration over the asset sales impacting income to combat elevated interest rates. The sale includes nine office and residential properties like 1350 Sixth Ave. and stakes in 245 Park Ave. and 750 Third Ave., the latter undergoing conversion to apartments.

Despite significant property demand, SL Green's stock has dropped by a third this year amid concerns over potential dividend cuts due to anticipated earnings declines from high renovation and maintenance costs. Moody’s highlights SL Green's considerable leverage, with nearly $7 billion in liabilities. Analyst projections indicate that the sale of these properties may reduce debt by $1.2 billion. SL Green’s strategy for 2026 focuses on debt reduction and targeted sales, supported by strong leasing demand in New York City's recovering commercial market, with intentions to utilize a $1.3 billion debt fund and pursue acquisitions and potential share buybacks.

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Catholic Church Sells Madison Ave. Land For $490M To Pay Abuse Victims

The Archdiocese of New York is selling a ground lease for 455 Madison Ave. to Lotte Hotels for $490 million to fund settlements for sexual abuse victims. This sale aims to maximize compensation for victims, with nearly half of the proceeds earmarked for this purpose. The Lotte New York Palace hotel, owned by Lotte since 2015, has been a prominent NYC landmark. Lotte views the acquisition as a crucial step in enhancing its global hotel brand. The deal, requires approval from the New York State Supreme Court due to the archdiocese's nonprofit status.

Apart from the lease sale, the archdiocese has already raised substantial funds through real estate transactions, totaling over $860 million since 2023, including a $103 million sale of its former HQ. These sales have collectively contributed roughly $300 million toward the global settlement for abuse victims, as highlighted by Cardinal Timothy Dolan in a note to parishioners. Additional transactions in 2023 included the sale of properties for $48 million and an upcoming sale projected to bring in $58 million to $68 million. The archdiocese also sold air rights over St. Patrick's Cathedral for up to $164 million, contributing further to its fundraising efforts linked to settlement payments.

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Bloomberg extends massive Midtown office lease with Global Holdings

Bloomberg has secured an 11-year lease renewal for 495,753 square feet at 120 Park Ave., marking a significant transaction in this quarter and the year. Global Holdings, which oversees the property, emphasized the lease extension reaffirms the building's value and suitability for global businesses. Bloomberg initially occupied the 26-story tower in 2011 and will continue to do so as their prior lease was set to end in 2029. This renewal syncs with their nearby assets at 731 Lexington Ave. and 919 Third Ave., where similar lease extensions were executed last year.

The estimated rental rate ranges from $75 to $92 per square foot, although the exact payment details remain undisclosed. The transaction, with representation from CBRE and Global Holdings, coincides with planned upgrades for the building, including renovations to its lobby. This deal is part of over 1.3 million square feet of leasing activity within Global Holdings' portfolio this year. The firm, led by Eyal Ofer, manages more than 10 million square feet of real estate nationwide, consisting of 120 properties and over 1,500 hotel rooms, with the 120 Park Ave. building acquired in 2008.

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Dunkin’ still dominates as city’s chain stores pull back

In 2025, Dunkin' maintained its position as the most common chain store across all five boroughs of New York City, marking its 18th consecutive year at the top despite slight reductions in its footprint. The chain's overall locations numbered 623, overtaking Starbucks as the leading retailer in Manhattan for the first time. Nonetheless, Dunkin' closed three sites amid a broader trend where total chain stores in NYC declined by 1.3%, resulting in a cumulative total of 8,314 locations. The landscape is changing significantly, with many legacy chains reducing their presence while newer food and beverage retailers gain momentum.

Seven of the top ten chains, including Starbucks, which closed 42 stores, saw reduced locations, and 18 retailers shuttered all their city locations this year, paralleling the significant impacts of the 2020 pandemic. Newer chains, particularly in food and fitness, are thriving, with 22 newcomers now boasting over 15 locations each, including Naya and Club Pilates. However, merchandise and pharmacy chains are experiencing notable declines. Despite its closures, Starbucks remains the second-most common chain with 286 stores, while Metro by T-Mobile, Subway, and McDonald's follow. The overall number of chain stores continues to be significantly lower than pre-pandemic levels, with Queens, however, showing resilience and growth in several neighborhoods.

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Embattled downtown landlord fights to hang on to Nolita hotel

Veracity Equities, led by Edmond Li, is facing a $35.3 million judgment due to a defaulted mortgage for The Nolitan hotel, a 55-room property in Nolita. The hotel, scheduled for auction, has seen its sale postponed to February 4, giving Li time to seek refinancing. The firm is also in foreclosure over a $32 million mortgage related to three rental buildings nearby. The Nolitan, which opened in 2011, was disrupted by the pandemic, leading Li to cease loan payments in 2021.

Amid legal turmoil, Silverpeak Real Estate Finance, the lender, has hindered revenue generation at the hotel by blocking investments in a potentially profitable rooftop bar. Additionally, crucial repairs have been prohibited under the court-appointed receiver's oversight. Justice Kahn ruled that Li remains liable for the debt, encompassing principal, interest, and fees. Originally purchased for $5.4 million, The Nolitan now offers rooms starting at $300 a night and features a restaurant named Kimika. Veracity, established in 1994, has faced escalating challenges since the pandemic.

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Bushburg buys FiDi office at steep discount for possible resi conversion

Joseph Hoffman’s company buys 100 William Street for $70M

Bushburg Properties has acquired the office building at 100 William Street for $70 million, significantly under the $167 million paid by Manulife insurance group a decade ago. The 21-story building, initially home to John Hancock Financial's real estate operations, is now only about 50% occupied, making it a prime candidate for residential conversion. Bushburg is already engaged in a major conversion project at nearby 80 Pine Street, transforming it into over 700 apartments. The sale was facilitated by Eastdil Secured, with representatives from both Bushburg and Manulife unavailable for comment.

Manulife initially purchased the Emery Roth-designed building in 2013 during a period of increased residential conversions in the Financial District, a trend that halted as the office market improved throughout the 2010s. However, post-pandemic challenges have led developers to capitalize on low property prices for conversions, as seen with Bushburg's earlier acquisition of 80 Pine Street for $160 million, also aimed at increasing residential space.

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Rudin’s 32 Sixth Avenue value slashed by 56%

Owner landed four-year extension on Tribeca office last month

Rudin's office building at 32 Sixth Avenue, formerly the AT&T headquarters, has seen a significant drop in value, falling to $340 million from $770 million in 2015, marking a 56% decline. The property underwent negotiations resulting in a four-year debt maturity extension to November 2029, alongside a commitment of $100 million for capital improvements, including a lobby renovation and an on-site leasing center. Rudin acquired the property in 1999 for $150 million and had previously invested $100 million to maintain high occupancy.

However, occupancy plummeted during the pandemic, reaching only 57% by June. Notable downsizing occurred with tenants such as CenturyLink, Dentsu, and iHeartMedia. The largest tenant currently is Telx, with a lease that lasts until 2033 for 146,000 square feet. Other tenants include Cedar Cares and MCI Communications Services, while Dorilton and Industrious secured a 52,000-square-foot lease in 2021 for the 13th floor of the building.

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Gucci's Parent Company Takes Haircut In Sale Of Fifth Avenue Trophy

Kering has sold a 60% stake in its retail condo at 715-717 Fifth Ave. to French private equity firm Ardian for $900M, approximately 7% less than the purchase price of $963M in January 2024. Kering will receive net proceeds of $690M while retaining a 40% stake. This marks Ardian’s first real estate venture in the U.S. as part of its expansion strategy. The investment firm manages $196B in assets. Eastdil Secured, which previously represented Jeff Sutton in selling to Kering, acted as Ardian’s advisor in this transaction. Kering’s 2024 acquisition reflects a broader trend of retailers purchasing high-value Manhattan properties, although the pace of such deals is reportedly slowing.

Additionally, Kering recently collaborated with Ardian in a joint venture involving three Paris properties, through which Kering retained a 40% stake and gained $860M. Kering's COO Jean-Marc Duplaix emphasized the strategic nature of these transactions for long-term retail presence and financial flexibility amidst financial challenges. Kering and its holding company, Artemis, have considerable debt, with Kering alone holding about €10B. Following a 46% net income drop in the first half of the year, Kering is undergoing a turnaround, led by new leadership and plans to close around 80 stores while offloading real estate in key cities.

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Savanna snags $510M to refi 5 Bryant Park

Funding retires CMBS loan after landlord missed critical payment 

Savanna has successfully refinanced its Midtown office tower at 5 Bryant Park, securing $510 million for the 683,000-square-foot property, as reported by the Commercial Observer. This floating-rate loan was arranged by an Eastdil Secured team, including Rob Turner, Grant Frankel, and Ethan Pond, and originates from King Street Capital Management and Blue Owl Capital. The refinancing replaces a previous $463 million commercial mortgage-backed securities loan, which Savanna struggled with after missing a balloon payment due in June 2023.

The loan, initially taken to finance the acquisition of the tower from Blackstone in 2018 for $640 million, had several one-year extensions exercised but was flagged due to a decline in net operating income. Savanna aims to utilize part of the refinancing proceeds to create an amenity center and enhance tenant areas, targeting to increase occupancy from the current 80 percent to above 95 percent next year. Despite facing challenges, Savanna is making strategic acquisitions, recently purchasing properties in the Meatpacking District and Broadway for significant discounts following previous owner defaults.