Manhattan’s office market turned in its busiest first half of leasing in nearly a quarter century during 2026, according to a second-quarter report released July 1 by commercial brokerage Colliers, and three marquee developments that advanced last week gave the data a physical face. Franklin Wallach, Colliers’ executive managing director of research and business development, said tenants signed 22.8 million square feet of leases across the first six months of the year, the strongest first-half showing since 2002, undercutting predictions that Mayor Zohran Mamdani’s tax agenda would drive business out of New York.
The numbers landed amid an intensifying fight over whether Mamdani, a democratic socialist who campaigned on raising taxes on corporations and the wealthy, would push companies to cheaper states. Instead, landlords spent the spring gaining leverage. Colliers put second-quarter leasing at 11.02 million square feet, down about 6.5 percent from the first quarter but up roughly 19 percent from a year earlier, the first time since 2002 that quarterly demand topped 11 million square feet for three straight quarters. Net absorption came in at a positive 3.51 million square feet.
Rents moved with the demand. The average asking rent climbed to $78.03 per square foot, its highest since July 2020, up 5.7 percent over the year in the sharpest midyear increase since 2016, per Colliers. Availability fell to 13 percent, down from 13.7 percent in March and the lowest since October 2020, well off the 18.2 percent peak of February 2024. Class A space captured nearly 69 percent of leasing, and artificial intelligence firms leased roughly 800,000 square feet in the quarter, more than those companies took in all of 2025. The quarter’s largest deal was law firm Simpson Thacher & Bartlett’s 916,000-square-foot lease at Extell Development’s 570 Fifth Avenue, followed by L’Oréal’s 484,000-square-foot renewal.
The clearest evidence of that confidence broke ground Thursday, when American Express began construction on its new global headquarters at 2 World Trade Center, the final commercial tower on the Lower Manhattan campus rebuilt after the September 11 attacks. In a statement issued through BusinessWire, the company confirmed the start of work on the 55-story, 1,226-foot tower designed by Foster + Partners and developed by Silverstein Properties. American Express, whose CEO is Stephen Squeri, will own the building and anchor it across nearly 2 million square feet, remaining at 200 Vesey Street until the tower is finished, targeted for 2031. Lisa Silverstein, CEO of Silverstein Properties, noted that her father, Larry Silverstein, 95, first promised in 2001 to rebuild the site. Mamdani attended and wielded a shovel, offering rare praise for a private-sector project, alongside Port Authority Executive Director Kathryn Garcia and Chairman Kevin O’Toole. The state estimates the build will create more than 2,000 union construction jobs and inject roughly $5.9 billion into the city’s economy.
A second project advanced in Midtown, where demolition began the week of July 7 at 350 Park Avenue to clear the way for a $4.5 billion, 1,414-foot supertall. The 64-story tower, also designed by Foster + Partners and developed by Vornado Realty Trust, Rudin and billionaire Ken Griffin, will deliver about 1.8 million square feet of Class A space. Griffin’s firms, Citadel and Citadel Securities, will anchor it with at least 850,000 square feet, nearly half the building, which the City Council approved 48 to zero. The demolition signals Griffin intends to follow through despite a bitter feud with Mamdani, who used the billionaire’s $238 million penthouse to illustrate a new tax on part-time residents. Griffin vowed to “double down” in Miami, but Vornado CEO Steven Roth attacked the mayor’s rhetoric on an earnings call, and executive Glen Weiss said the firm had “started demolition and we’re ready to roll.” Griffin took a 60 percent stake in the venture in December; Vornado and Rudin hold an option through July to keep interests of 23 to 40 percent or sell the site to Griffin for $1.2 billion.
The third move surfaced Thursday, when The Wall Street Journal identified Airbnb as the buyer of 281 Park Avenue South, the landmarked Beaux-Arts building in Gramercy known for its tie to con artist Anna Sorokin. Airbnb paid $81.5 million for the six-story, 42,500-square-foot property, its first building purchase anywhere and the only one it owns. CEO Brian Chesky said the deal reflected a long-term commitment to the city and would house one of the largest employee hubs outside San Francisco. The purchase is notable because Airbnb has been largely shut out of the city by Local Law 18, the 2022 short-term rental crackdown it continues to fight. Seller RFR, controlled by Aby Rosen, bought the 1894 building for $50 million in 2014 and booked a 63 percent premium, in a deal marketed by Avison Young’s James Nelson and broker Ryan Serhant.
The activity runs against a budget standoff beneath the leasing figures. Mamdani’s administration is weighing options to close a $5.4 billion shortfall while keeping its “tax the rich” platform, drawing warnings from Steven Fulop, president and CEO of the Partnership for New York City, that higher levies could push firms out. Expansion south remains real: JPMorgan Chase employs more workers in Dallas than in New York, and CEO Jamie Dimon wrote that the pattern would likely continue. For now, the transaction data points the other way, with Colliers projecting Manhattan’s busiest leasing year since 2000 if the second half holds.
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