Executive Summary
AI-led demand defines Q2 leasing
Manhattan leased 10.8 million square feet in the second quarter, one of its strongest quarters in years, and overall availability settled at 14.5%, down from 17.6% a year earlier. Average asking rent held near $80 a foot.
Technology led the demand. Sublease inventory kept falling, now under 11 million square feet, as landlords pulled blocks back to hold for direct deals rather than cut sublease bargains. In plain terms, the discount tenants keep waiting for is not showing up.
The borough’s tech and media requirements reached 8.8 million square feet, with 22.1% of that coming from AI firms alone, the clearest read on where the market’s momentum now sits.
The venture-backed cohort is the through-line. From Series A through D, growth-stage tenants are signing full floors and multi-floor blocks, and their rents sort by building quality more than by neighborhood alone.
AI and tech tenants have signed 21 deals for 719,200 square feet so far in 2026, close to 70% of it in Midtown South.
The names in the sections that follow, and the neighborhoods they chose, show where that demand is concentrating: Midtown South, the Broadway loft corridor, and Hudson Square. A taking-rent index near 94.8%, up from 92.5% a year earlier, means landlords are holding closer to ask.
Market Pulse: where the space actually is
Read the submarkets against each other. SoHo runs tight on direct space, the borough sits in the mid-teens, and Midtown South and Hudson Square carry the higher availability. For a growing tenant that is not a weakness, it is where the large contiguous blocks and the room to negotiate both still exist.
The quarter in numbers
| Measure | Q2 2026 | Context |
|---|---|---|
| Leasing | 10.8M SF | Q2 leasing, final quarter total |
| Net absorption | +4.4M SF | Year to date |
| Tech and media requirements | 8.8M SF | 22.1% from AI |
| Sublease inventory | <11M SF | From a 23M SF peak |
| Taking-rent index | ~94.8% | Up from 92.5% a year ago |
| Class A premium over Class B | 25.5% | Downtown · Q1 2026 |
Hudson Square’s higher availability is by design, not weakness. Much of its supply sits in the Norges Bank and Hines Hudson Square portfolio, whose assets are built and held for larger-block tenants in the 40,000 to 400,000 square foot range. Even so, asking rents keep climbing, and minimum lease terms sit comfortably at seven years on the low end.
The quarter’s nine largest leases
From AI hype to office commitments
The nine largest signed leases of Q2, ranked by square footage. Law firms took the biggest blocks, but the rest of the list tells the real story: AI, legal-AI, healthcare-tech, and fintech are now signing at scale, from the Broadway loft corridor to One World Trade Center. The takeaway for a growing tenant is simple: the space you want is the space they want, so the good blocks clear fast.
| # | Tenant | SF | Building · submarket | Sector | Deal · signed |
|---|---|---|---|---|---|
| 01 | Simpson Thacher & Bartlett Largest in ~6 yrs | 916,000 | 570 Fifth Avenue · Midtown Extell Development | Law | New lease May 2026 |
| 02 | Cleary Gottlieb Steen & Hamilton | 475,000 | One Liberty Plaza · Lower Manhattan Brookfield | Law | New lease April 2026 |
| 03 | Alston & Bird Fills the tower | 170,000 | 51 West 52nd Street · Midtown Harbor Group Intl. | Law | New lease · 15 yr June 2026 |
| 04 | Tennr | 124,733 | 345 Hudson Street · Hudson Square Hudson Square Properties | Healthcare AI | New lease April 2026 |
| 05 | Baker McKenzie Ask $165/SF | 122,000 | 10 Bryant Park · Bryant Park Property & Building Corp. | Law | Renew + expand May 2026 |
| 06 | Sierra | 94,145 | 11 East 26th Street · Midtown South / NoMad Rockrose | AI | New lease Spring 2026 |
| 07 | Adyen | 90,000 | 111 & 115 Fifth Avenue · Flatiron Winter Organization | Fintech | New lease · 10 yr April 2026 |
| 08 | Norm Ai Relo from 7 WTC | 64,313 | One World Trade Center · Lower Manhattan Durst Organization | Legal AI | New lease May 2026 |
| 09 | Altana Relocating and tripling from Williamsburg | 62,000 | Midtown | AI | New lease Spring 2026 |
Landlord shown under each building. Market transactions reported in the trade press, not Nomad assignments.
Also on the board in Q2: Adaptive Security subleased 51,000 SF at 120 Broadway, Synthesia took 50,000 SF in the Flatiron, Apollo Global Management 50,000 SF at 590 Madison, Robin Hood 53,000 SF at 841 Broadway, and Steve Madden 60,000 SF at 501 Seventh Avenue. The AI, legal-AI, healthcare-tech, and fintech deals sit closest to our tenant base, and note how many now sit Downtown.
Spotlight: SoHo & Hudson Square
The headline: Hudson Square is where the big tech tenants go when they need room to grow. It has become Midtown South’s premium overflow market, the place where tenants who cannot find large contiguous blocks elsewhere can still execute at scale. It carries more inventory than SoHo, about 10.7 million square feet against 6.5 million, and it commands a premium for building quality, with a tech ecosystem now anchored by PayPal, Google, Notion, Tennr, and, as of this quarter, Anthropic. Nomad has closed here too. SoHo, tighter and pricier per foot, is the brand-first boutique: prestigious and expensive, but rarely built for the 100,000-plus square-foot blocks the AI cohort now generates.
| Tier | Asking rent / SF | Example |
|---|---|---|
| A | ~$99.79 | Hudson Square institutional average |
| B | ~$89.15 | SoHo average asking |
| C | $60 to $75 | Creative loft |
Hudson Square average asking runs about $90.50 to $99.79/SF, up roughly 17% over three years from about $77/SF in early 2023. SoHo averages about $89.15/SF on a tighter, more fragmented base near 12% direct availability. Hudson Square’s higher total availability, near 17.8%, is what still lets a large tenant find scale. Tier figures should be confirmed on a specific building.
Anthropic · 330 Hudson Street, the entire building
Hudson Square · AEW Capital · 466,000 SF, the whole 16-story building. Signed July 8, 2026. Anthropic took the entire building, one of the largest AI office commitments in the city and a stamp on Hudson Square as Manhattan’s AI campus. It roughly doubles Anthropic’s New York footprint, with room for about 1,700 people, as Deloitte, the Financial Times, and Anomaly phase out.
Spotlight: Unicorn Lane, the Indigo Mile
The headline: if you are an early-stage tech team, this is your street. Unicorn Lane is not a single avenue. It runs up Broadway from 10th Street to 34th Street, between Park Avenue South and Seventh Avenue, and it is the densest stretch of early-stage tech in the city. Close to 70% of Manhattan’s AI deals this year landed in this Midtown South orbit. Prewar lofts, flexible floors, and a wall-to-wall peer ecosystem are exactly what a Series A to B team wants when it needs room to double without hopping buildings every year.
| Tier | Asking rent / SF | Example |
|---|---|---|
| A | Up to $170 | Trophy · e.g. 11 East 26th Street |
| B | Up to $100 | e.g. 119 Fifth Avenue, 37 East 18th Street |
| C | Up to $65 | Prewar loft |
The corridor’s ladder has stretched. Class C prewar loft is reaching $65/SF, Class B up to about $100/SF (119 Fifth Avenue, 37 East 18th Street), and the best Class A trophy up to $170/SF (11 East 26th Street). Confirm on a specific suite.
Nomad manages more than 2 million square feet of office space in New York City, much of it along Unicorn Lane, exactly where early-stage tech is landing. When a founder needs leverage here, we do not go find it. We create it in-house.
Spotlight: Bryant Park
The headline: this is the trophy ceiling every other submarket is measured against. Bryant Park is the trophy end of Midtown, and the quarter proved it. Baker McKenzie renewed and expanded to 122,000 square feet at 10 Bryant Park at a $165 asking rent, the kind of number that only clears in the tightest, most amenitized product. One block over, One Bryant Park absorbed Bank of America’s 2.4 million square foot expansion earlier in the year, the second largest Manhattan lease of the century. This is not startup territory on price, but it sets the ceiling every other submarket is measured against.
| Tier | Asking rent / SF | Example |
|---|---|---|
| Trophy | $165 | 10 Bryant Park ask |
| A | $85 to $100 | Prime Bryant Park / Sixth Avenue |
| B | $70 to $80 | Older Class A stock |
Trophy asking of $165/SF is the quoted rate on the 10 Bryant Park deal (May 2026), not a submarket average. Prime Bryant Park and Sixth Avenue Class A generally runs about $85 to $100/SF, with older stock lower. Confirm on a specific suite.
The trophy ceiling keeps rising: a lease at 9 West 57th Street averaging $327.50 a foot is thought to be the highest office rent ever signed in the city, while a top-floor sublease at One Vanderbilt, beside Grand Central, is reaching for about $350.
Nomad Notion: Downtown is the value play right now
The loudest lease of the quarter was not in Midtown. American Express committed to the entire 2 World Trade Center, roughly 2 million square feet, the generational anchor that finally completes the World Trade Center campus. When a name that size plants a flag, the rest of the market reads it as a signal. So do we.
Here is the signal. You can still get Class A Downtown for less than the all-in cost of comparable space in Midtown or Midtown South. Same trophy quality, lower total number, and that gap is exactly why the tech names are moving. Norm Ai took 64,313 square feet at One World Trade Center. Adaptive Security subleased 51,000 at 120 Broadway. Dandy took 37,000 at 22 Cortlandt. Cleary Gottlieb committed 475,000 at One Liberty Plaza. Five years ago that tenant mix Downtown was unthinkable.
It is a genuine value play, and the firms taking advantage of it are getting trophy buildings, big contiguous floors, and real concession packages, at a number Midtown South cannot match right now. Speed still decides it. The teams that have done the work, that know the three buildings that fit and can move, are the ones winning the space and the terms. The discount is real, and it narrows as the migration accelerates.
This is not a case for chasing the cheapest rent. It is a note that the map has changed. The firms that widened their search this quarter, and looked Downtown alongside Midtown South, are the ones getting trophy space at a discount. We expect more to follow.
— Nicholas Hein, Director, Nomad Group
Where vision takes shape
If your team is heading toward its next 10,000 to 50,000 square feet, the read on this quarter is simple: the good space clears fast. We know the loft districts block by block.
Sources & methodology
Where the numbers come from
- Marketwide metrics · availability, asking rent, absorption, and leasing, from the latest month-end reads used as a Q2 proxy, with final Q2 leasing volume from the one quarter-final source published to date.
- Submarket detail · SoHo, Hudson Square, Midtown South, and the rest, from Q1 2026 submarket tables and spring 2026 asking surveys.
- Named transactions · Q2 2026 and recent leases reported across the real estate trade press and verified against multiple outlets.
- Tech and venture detail · AI and Series A to D tenant moves, with funding stage from company and investor announcements.
- Concessions · taking-rent index used as a proxy; it captures rent discounting but not free rent or improvement allowances.
- Nomad transactions · Nomad’s completed leases and active availability sheet, asking rents only.
- Full source list · available from Nomad on request.
Methodology
This issue reviews the second quarter of 2026 (April 1 to June 30). Final quarterly leasing volume was available from one source; quarter-end supply, rent, and absorption are best proxied by the latest month-end reads, since full Q2 desk reports publish in mid to late July. Where figures differ across desks, we use the more conservative reading. Anthropic’s lease of the entire building at 330 Hudson Street was finalized in early July 2026 and is treated here as signed. Any item still described as reported or rumored is labeled as such.
Named leases are verified against multiple outlets before inclusion, and the Hudson Square lab lease is a Nomad-completed transaction. The taking-rent index is a concession proxy: it captures rent discounting off ask but not free rent or improvement allowances, so a full concession read should come from broker books. Tier-level asking rents blend published market data with Nomad’s own active availabilities and should be confirmed on a specific building. Full source detail is available from Nomad on request.
Statistical base: Q1 2026 · Data through: June 30, 2026 · Published: July 2026
Prepared by Nomad Group for informational purposes. Market data is sourced as noted above and believed reliable but is not guaranteed; asking rents and availabilities change without notice. This report is not an offer, a lease, or investment, legal, or tax advice.