Manhattan Office Visits Drop
A harsher winter and congestion pricing are among the factors affecting attendance.
In January, Manhattan office buildings’ average visitation rate was 66 percent of 2019 baseline levels, down from 72 percent the previous month and matching the rate in January 2024, based on Placer.ai data, as released by The Real Estate Board of New York.
Historically, a visitations rate drop from December to January is standard. Excluding the month’s two holiday weeks featuring Martin Luther King Day and New Year’s Day, the January 2025 rate would have equaled December 2024’s average rate.
Weather also played a factor. New York City’s average daytime temperature was 34 degrees in January 2025, compared to 41 degrees in December and 39 in January 2024. In January 2025, New York City experienced 4.5 inches of snow, compared to 2.3 inches in January 2024.
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Visitation for Class A+ buildings averaged 80 percent, down from 86 percent the previous month but up from 78 percent in January 2024.
Class A/A- buildings averaged 63 percent during January, down from 70 percent during December and slightly above 62 percent in January 2024. Class B/C building visitation slid 4 percent month-over-month but was up 5 percent year-over-year.
Manhattan’s office utilization
According to Avison Young’s latest Office Busyness Index figures, Manhattan office utilization is 79.9 percent of pre-COVID levels. Across the U.S., office buildings are 66.9 percent as busy as in January 2019, ultimately showing that NYC is 13 percent ahead of national figures.
“In a world where hybrid work has become so prevalent, the weather has become a significant factor for office attendance,” Pierre Debbas, Esq., co-founder of Romer Debbas LLP, told Commercial Property Executive.
This winter has been significantly colder this year than last, along with an increase in snowfall which has definitely hurt office attendance, Debbas added.
“[NYC’s] congestion pricing likely also played a role in office attendance as post-pandemic there is an increase of the workforce who prefers to drive in than utilize public transportation, and congestion pricing is only an added burden to an already expensive commute to the city.”
Debbas said Class A continues to outpace the rest of the market, predominantly driven by return-to-office mandates that larger corporations are imposing and the allure of all of the amenities that these companies provide in comparison to smaller and mid-sized businesses, which predominantly rent in Class B buildings.
The hybrid model is here to stay
Despite the headline, comparing office visitations for the past month to a pre-pandemic baseline may not be intuitive, according to Michael Webb, partner at Farrell Fritz P.C.
“Remote, work-from-home and hybrid employment arrangements have fundamentally, and perhaps permanently, changed how many work and live,” he told CPE. “It is unlikely that in-office work during the post-pandemic era will ever rise to pre-pandemic levels.”
However, REBNY’s latest monthly analysis of office visitation data for Manhattan buildings indicates the more significant “flight-to-quality” trend the office sector has experienced post-pandemic and suggests that high-quality office assets in major markets are far from having hit rock bottom, he said. The flight-to-quality trend in office leasing is not necessarily new but is borne out by the Placer.ai data analyzed by REBNY.
As REBNY highlights, Class A+ buildings in Manhattan had an average visitation rate of 80 percent for January. The rate drops 17 percent for Class A/A- office buildings to 63 percent, and it drops yet again for Class B/C office buildings.
“The data highlights that companies continue to seek, use and occupy office space in high-quality buildings that offer modern amenities, proximity to retail, transit or areas of socio-cultural interest, as well as health, wellness and sustainability initiatives and packages,” Webb said. “The REBNY analysis highlights the growing disparity within the market between full-service, high-end spaces and lower-quality properties.”
Premium office buildings also attract top dollar financing as a result. Earlier this year, Ivanhoé Cambridge, the real estate group of CDPQ, refinanced its 42-story trophy office tower at 3 Bryant Park in Midtown Manhattan, to the tune of $1.1 billion. JLL’s Capital Markets group arranged the funding.
Strict mandates can hurt office dynamics
Earlier this year, Amazon, Disney, JP Morgan, Starbucks and X summoned workers back to the office full or part-time, Robert Martinek, director at EisnerAmper, shared.
“However, it has been reported that companies that have enacted strict return-to-office requirements have had to deal with losing talent, as some top performers have quit,” he told CPE.
Some feel strict mandates can hurt office dynamics and reduce employee satisfaction, Martinek added. Except for government employees, most companies have adopted a flexible work arrangement. Remote workers have been home since the pandemic and have gotten used to working from a home office.
Supporters indicate that ‘work from home’ helps with family duties, Martinek observed. Additionally, there is no evidence that work-from-home employees are less effective than their counterparts.
“Many companies are downsizing their space but not removing it completely. The ‘two to three days in the office’ works best for companies and employees. The hybrid model is here to stay!”
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