After several years of uncertainty and skepticism about New York’s office market, positive signs are emerging – and much of it is centered in Midtown Manhattan.
In the first quarter of 2025, Midtown saw 4.85 million square feet of leasing activity – a 47 percent increase over the five-year quarterly average and 31 percent better than the first quarter of 2024.
Midtown is outperforming the rest of Manhattan’s submarkets and the increase in leasing activity points to the local economy gaining steam, bringing more activity, jobs, and workers to the area.
While this surge speaks to the inherent advantages of New York’s most prominent central business district, it does not yet represent what our stores, restaurants, hotels, and surrounding economy truly need: a full recovery. Retail in Midtown is still recovering to pre-pandemic levels, trailing the office market’s resurgence. To maintain our competitive edge, especially on a global scale, we need to think holistically about transforming Midtown’s neighborhoods into even more exciting destinations for New Yorkers and continue investing in the smart ideas and designs that put them first.
The city’s plan to redesign Fifth Avenue between Bryant Park and Central Park for the first time in the boulevard’s 200-year history represents an important turning point. The $350 million transformation of these 20 blocks into a greener, pedestrian-focused corridor will return this street to the New Yorkers and tourists who pound the pavement every day.
Public realm projects like Fifth Avenue and the new plaza at Pershing Square East across from Grand Central Terminal help reactivate neighborhoods that went dormant in the pandemic, attracting business to new spaces, enticing employees back to work, spurring increased investment, and generating vital tax revenue. In 2021, there were only two commercial real estate sales between 42nd Street and 59th Street totaling $170 million, but after announcing plans to rethink the avenue, Fifth enjoyed a stretch of record-breaking investments.
From 2023 through February 2024, there were 10 sales on this stretch of Fifth for a total of $3.9 billion. In addition, Rolex broke ground on its new flagship store, Chanel opened its first flagship jewelry store in the US, and Kering, the owner of Gucci and Balenciaga, closed on two buildings on the avenue, paying close to $1 billion. These are clear signals of enthusiasm for transforming Fifth into a boulevard that rivals others around the world, such as the Champs Elysees in Paris and Bond, Oxford and Regent Streets in London.
That’s also why projects like the planned 12,500-square-foot public plaza at 350 Park Avenue and its accompanying state-of-the-art office building are so important. The Class A office tower will house Citadel’s New York workforce and provide more than 6,000 total jobs. The news of this massive investment has injected optimism into the market and cemented Park Avenue as one of the most sought-after addresses for financial firms in the world. It also builds on momentum in the area, following major projects like One Vanderbilt, 425 Park, 343 Madison and JPMorgan Chase’s new headquarters at 270 Park that underscore Midtown’s command of the office market.
The crown jewel of the tower will be an expansive public concourse with green space, seating, food and beverage vendors, al fresco dining and increased visibility of nearby landmarks. This major investment in the streetscape will go beyond beautifying the sidewalks – it will deliver a much-needed public amenity. The project will also contribute more than $35.8 million for the city’s Midtown East Public Realm Improvement Fund – a win for the entire neighborhood.
As one of the first new office towers to go through the city’s review process since the pandemic, 350 Park is the poster child for unlocking the value of the Midtown East rezoning. It puts forth a model to capitalize on Midtown’s commercial boon and use the tools at our disposal to create a world-class network of public space here.
To that end, Park Avenue stakeholders and local elected officials have been successful in getting funding from the East Midtown Governing Group for a reimagining of the Park Avenue Malls in conjunction with the MTA Metro-North Railroad plan to rehabilitate the Grand Central Terminal Train Shed. This will provide a cohesive design vision for adding greenery, public seating and safer crossings for pedestrians on Park Avenue from 46th Street to 57th Street.
Midtown is not an island – it is part of the broader Manhattan ecosystem – and the city stands to maximize its investment in Midtown East and Fifth Avenue by supporting development that also elevates the public realm. By greenlighting innovative projects like 350 Park Avenue, the city will once again establish Midtown as a model for how metropolises can reinvigorate their business districts for decades to come.
Edward Pincar Jr. is the president of Fifth Avenue Association and Alfred C. Cerullo, III, is the president/CEO of Grand Central Partnership.
