We recently closed three deals and a fourth is on the way, continuing what has been a banner year for Armano Real Estate. The tenants include a fashion company, a construction company and a not for profit. We are also in lease review for a wine company.
Interestingly, the fashion, wine and construction companies are all directly affected by tariffs. However, despite business challenges, they are moving forward with lease extensions. Three of these lease transactions are new relationships. These are clients we expect to have for the life of our business by helping lower real estate expense, improve office space plans and creating substantial business value.
There is a good reason for tenants to plan early. Space demand has remained steady, but office supply is dwindling. Since 2020, over 6.5 M sq ft of office space has been converted through 2024, with another 16.5 M sq ft scheduled to be removed from inventory by year-end—creating a potential 200-bps drop in availability.
Please see our video link below and feel free to reach out to us for a complimentary lease review or space planning consultation.
Key Metrics (June 2025)
- Leasing Activity
- 2.53 M sq ft leased in June—approximately 46% above the five-year monthly average of 1.73 M sq ft.
- Year-to-date leasing totaled 12.88 M sq ft, up 37% YoY
- Renewals
- 572,000 sq ft renewed in June; 3.04 M sq ft YTD .
- Availability Rate
- Fell to 17.6%, down 10 bps MoM and 260 bps YoY.
- Net Absorption
- +584,000 sq ft in June, bringing YTD absorption to +4.92 M sq ft.
- Average Asking Rent
- Stabilized at $76.44/sq ft, down 1% MoM and YoY.
- Sublease Market
- Sublease availability at 3.5%, unchanged MoM; average sublease rent $57.36/sq ft (flat YoY).
Spotlight Highlights
- Strong leasing momentum in June drove a near 5 M sq ft YTD absorption—signaling robust tenant demand.
- Inventory tightening follows sustained absorption and conversion activity, with availability down significantly since last year.
- Rents steady, with only slight YoY declines, reflecting softening but underlying market balance between supply and demand.
Market Context & Drivers
- CoStar reports Manhattan’s office leasing hit its strongest performance in over eight years—“nearly all pre-pandemic levels”—fueling confidence in Park Avenue and other prime corridors.
- Major tenants continue to execute large leases: Amazon (330K sq ft at 452 Fifth Ave), NYU (1.07 M sq ft at 770 Broadway) and Invesco (204K sq ft at 225 Liberty St).
- New developments advancing: Deloitte’s 800K sq ft pre-commitment at 70 Hudson Yards, and a 1,200‑ft office tower near Central Park backed by Saudi PIF signal renewed capital inflow and confidence.
