Manhattan’s Tech Sector Notched a Record Number of Lease Deals in 2025

Manhattan’s technology sector in 2025 increased its office footprint by 6.54 million square feet, according to a new office leasing report from Colliers. The year was second only to 2019 in terms of new square footage, but its count of 235 lease deals shattered a 2019 record by 80 transactions.

“There were more transactions in almost every size category, except for the very largest,” Frank Wallach, executive managing director with Colliers, told Commercial Observer.

It’s onwards and upwards in 2026. Tech’s office leasing activity totaled 1.89 million square feet during the first quarter, surpassing last year’s quarterly average, largely thanks to the artificial intelligence sector’s voracious appetite for office space. 

AI tenants accounted for one-third of the office market’s tech demand in the first quarter of 2026 with 670,000 square feet of leasing, up from a 12.1 percent share of tech demand in 2025. This year’s total AI-related office demand so far — when health tech platform Tennr’s 125,733-square-foot sublease at 345 Hudson Street in April is added to the mix — has already eclipsed 2025, according to Colliers.

For such massive deals, space is getting tight. Manhattan tech companies in need of footprints in excess of 250,000 square feet currently have just 24 options available within the next 12 months, Wallach said.

New York City’s tech tenants benefited from a windfall of concessions in 2025, the Colliers report also noted. Last year, the sector raked in an average rental abatement of 13.3 months and tenant improvement allowances reaching $131.70 per square foot. The tech sector’s taking rents, which averaged $90.35 per square foot in 2025, were just 0.1 percent below record highs in 2019.

Midtown South’s supply of prewar buildings remained enormously popular among the tech crowd, capturing two-thirds of the sector’s office demand in 2025 and into 2026, according to Colliers. Midtown, too, notably secured a record 1.18 million square feet of office leases in 2025 from the likes of Amazon and Salesforce. 

But Lower Manhattan had a more subdued office leasing market in the first quarter, according to a new report from the Alliance For Downtown New York. Still, new leasing there, too, was led by the tech sector. 

AI security platform Adaptive Security relocated to 51,220 square feet at Silverstein Properties’ 120 Broadway in Lower Manhattan’s largest new lease, while SHoP Architects claimed the largest deal for 2025 overall for the area, with a 56,196-square-foot renewal and expansion at the Cammeby’s International-owned Woolworth Building.

Emily Davis can be reached at edavis@commercialobserver.com.