Event lead. Manhattan just posted its strongest nine-month leasing tally since 2006—23.2M SF through September—pushing past the 2018–2019 benchmark even as U.S. leasing remains ~11% short of pre-pandemic norms. The mechanism is clear: executives are trading commodity space for amenitized, efficient floors. As a result, underwriting in New York is now about quality scarcity rather than generalized demand. A high-low market is hardening. For credit, that bifurcation matters.

Deloitte’s near-three-quarter commitment at a new Hudson Yards tower and Amazon’s 330k SF expansion on Fifth Avenue anchor a roster of finance, tech, media, and advertising leases chasing modern systems, wellness, and location. Data point to behavior: 143 leases above $100/SF YTD. That is pricing power, not narrative. Meanwhile, national absorption remains patchy. In turn, capital allocators should weight underwriting to tenant quality and building spec as primary risk drivers, not simply submarket averages.

New construction has lagged for years, while legacy Class B/C stock struggles to clear. Landlords with upgraded amenities are seeing tour velocity and faster decision cycles; backlog of “best floors” is real. On balance, that scarcity is nudging effective rents higher at the top even as concessions persist elsewhere. With the U.S. vacancy rate at 18.6% in September, NYC’s premium segment functions as a separate market—one where downtime shortens and TI packages can be targeted rather than blanket. Implication: prioritize capex that unlocks Tier-1 spec (air, light, loadout, wellness) versus cosmetic spend.

Liquidity is following the tenants. Manhattan investment sales hit $4.9B in Q3—+191% QoQ—with trophy trades re-establishing prints (e.g., 590 Madison) and new deals like Park Avenue Tower reinforcing price discovery. Nonetheless, spreads bifurcate: top assets clear with tight execution; vintage commodity assets face structure or no bid. Underwriting takeaway: assume 50–60% LTV from banks/insurers on prime, with cash sweeps and recourse creep for anything outside the top quartile.

U.S. demand is still hybrid and uneven. Even optimists concede national leasing trails pre-COVID. For now, model utilization risk explicitly: shorter average terms, mid-week peaks, and operational intensity (security, janitorial, energy) that rises with return-to-office. Require DSCR cushions and vacancy reserves for non-trophy collateral; underwrite market-effective rents post-concession, not face. Tie construction proceeds to pre-leasing (≥50%) where new supply re-starts.

Midtown, 10:12 a.m.: a leasing team queues successive tours through a renovated high-rise—biophilic lobby, fresh MEP, flexible conference center. By contrast, two blocks away, a 1980s mid-block tower pitches on price. Ultimately, tenants are choosing either the prime corner or the peak spec—not both. That choice is unique to NYC’s depth and connectivity.

Expect solid, but moderating, velocity as pent-up relocations work through 2026. Prime Midtown rents have room to firm 3–5% with constrained near-term supply; Class B/C likely treads water without capex. If policy momentum for conversions accelerates, removal of obsolete stock can steady the base. On the capital side, more big-ticket prints are probable if rates stabilize; NYC trophy cap rates could compress 25–50 bps as lenders expand appetite—though underwriting remains unforgiving for older assets. Wildcards: macro growth, rate path, and corporate attendance mandates will set the ceiling