It promises to be a banner 2026 for the Big Apple’s commercial real estate — at least on paper.
But since this column has been the clarion of optimism all year, excuse our indulging the dark side today.
First, the good news. As we were often first to report, the barometers of a market that’s not only healthy but thriving were plentiful. They included shrinking vacancies, sharply reduced sublease availability, slowly rising rents and a return-to-office wave that’s the envy of every other US city.
There were major expansions by Jane Street Capital, Guggenheim and Amazon. Bloomberg LP’s extensions of all three of its Manhattan leases until 2040 proclaimed confidence. Planned new towers at 350 Park Ave. and 343 Madison Ave. got their green lights. The first $1 billion-plus building sale in five years took place at 590 Madison Ave.
Hotels are thriving. Accelerated residential conversions cleansed the market of scores of obsolescent, Class-B properties.
So where’s the downside?
For all the planned new developments, too many prominent sites lie barren where developers wait on financing or anchor-tenant miracles that might never come.
London, the city that is New York’s primary competitor, doesn’t have half as many ugly holes in the ground with no plans filed as Manhattan does.
There are at least five of them on West 57th Street alone; on three blocks along First Avenue below the UN; several prime blocks of Midtown Madison and Park avenues; and on thriving Sixth Avenue between West 44th and 45th streets.
There are more empty holes and vacant lots downtown than can be counted — none more visible than the some-day site of Two World Trade Center. Until Larry Silverstein signs Amex or another anchor tenant to get the project off the ground, the 16-acre site’s recovery will remain achingly incomplete.
In the “not vacant but troubled” category are three prime chunks of cityscape.
The former Roosevelt Hotel’s future is way up in the air as owner Pakistan International Airlines fidgets over what to do with the empty hulk after JLL walked away from its sale-agent role last summer.
The beloved but antiquated Chrysler Building will continue to lose luster until landowner Cooper Union finds a developer that can afford the skyrocketing cost of the ground lease.
The South Street Seaport took on water after Howard Hughes Corp. spun it off into Seaport Entertainment Group. The Tin Building is scaling back; tacky “immersive” attractions encroach on home-grown restaurants; and the next-door lot at 250 Water St. is a question mark since SEG sold it off last summer.
The retail landscape falls well short of cheery surveys by the Real Estate Board of New York, commercial brokerages and business-improvement districts which cite reduced “availabilities” — but overlook what New Yorkers actually see.
The former Barneys at 660 Madison Ave. remains a dark hulk after six years. Brooks Brothers’ opening at 195 Broadway and Printemps at 100 Wall St. belie innumerable empty spaces nearby. “Prime Retail for Lease” signs are everywhere, and still seem to outnumber stores from Broadway on the Upper West Side to corridors in central Greenwich Village and Flatiron. There are even huge empty storefronts on Fifth Avenue in the East 50s and on East 42nd Street.
But perhaps the darkest cloud is environmental zealotry over “100-year flood” fears that would deny the five boroughs access to the historic basis for their current-day prosperity: the waterfront.
A southern portion of Battery Park City is already ruined by the “redesign” of Wagner Park. Even worse sea-wall construction is already past the planning stages at many river and harbor locations.
At this rate, even the Coney Island ocean might eventually be blocked from view.
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