Deals & development · 10/22/2026
Manhattan Investment Sales Fall 27% in Q3 but Year Still Tops 2025
Avison Young reports that Manhattan investment sales fell 27 percent in the third quarter of 2026 to $2.5 billion, the second straight quarterly drop. Year-to-date volume is still ahead of 2025, and deal count rose 22 percent to 273 sales. Multifamily led the gains, while development slowed sharply.
Reported by Commercial ObserverRead the original ↗
What happened
Commercial Observer reported on October 22, 2026 that investment sales in Manhattan totaled $2.5 billion in the third quarter of 2026. That was a 27 percent drop and the second quarterly decline in a row. The figures come from Avison Young's latest investment sales report.
The full-year pace is still ahead of 2025, but it is below the 10-year average because deals are smaller. The number of deals rose 22 percent over the first three quarters, to 273 sales. Manhattan is on track for more than 360 transactions this year. Across New York City, sales volume rose 13 percent over the first three quarters, to $16.2 billion.
Office and multifamily made up roughly 70 percent of Manhattan's third-quarter dollar volume. Multifamily year-to-date dollar volume was up 74 percent from last year, and average prices per square foot were up 34 percent. Office was nearly half of the quarter's dollar volume, even after a 23 percent drop from the spring. Retail volume rose 54 percent over the prior quarter, and conversion sales rose 27 percent. Development fell. It was down 17 percent year to date and 54 percent over the quarter, and average development prices per square foot fell by nearly half from 2025 levels.
Brandon Polakoff, head of New York City investment sales at Avison Young, said, "We'll have our record year this year, even through all of this." He called the development drop "an off quarter, but not an off asset class." The report lists higher interest rates, geopolitical uncertainty and rising Treasury yields as reasons investors are hesitating. Private buyers lead the market. REITs grew their share of dollar volume from 7.3 percent in 2025 to 36 percent so far this year. International buyers continued to pull back.
Key facts
- Source
- Avison Young investment sales report, reported by Commercial Observer on October 22, 2026
- Manhattan Q3 2026 volume
- $2.5 billion, down 27 percent
- Manhattan deal count
- 273 sales in the first three quarters, up 22 percent
- Citywide volume
- $16.2 billion in the first three quarters of 2026, up 13 percent
- Manhattan multifamily
- Year-to-date dollar volume up 74 percent. Average price per square foot up 34 percent.
- Development sales
- Down 17 percent year to date and 54 percent over the quarter. Price per square foot down nearly half from 2025.
- REIT share
- 36 percent of Manhattan dollar volume so far in 2026, up from 7.3 percent in 2025
- Full-year outlook
- More than 360 Manhattan transactions expected this year
What it means
Buyers and owners
Manhattan multifamily buildings are selling at higher prices per square foot than last year, and there are more deals overall. Owners thinking about selling face a market where REITs and private buyers are active, but interest rates are still a concern.
Landlords
The report shows strong multifamily demand in Manhattan. It does not split results by rent-stabilized and market-rate buildings, so small landlords should not assume these gains apply to every building type.
Tenants and voucher holders
More building sales mean more tenants may get a new owner. A sale by itself does not change the terms of an existing lease.
The highlights
- Manhattan multifamily dollar volume is up 74% year to date; price per sq ft up 34%.
- Citywide sales volume rose 13% in the first three quarters, reaching $16.2 billion.
- Development dollar volume fell 17% year to date; average price per sq ft nearly halved.
Why it matters Landlords
Rising multifamily sales and prices point to strong investor demand for NYC rental buildings, a useful signal for owners weighing a sale.
Not known yet
- How rent-stabilized buildings performed compared with market-rate buildings in this report
- Which specific Manhattan buildings sold and where
- The size of the smallest deals the report counts
- Whether higher sale prices will lead to rent changes for current tenants
Background
In New York City, a building sale does not by itself cancel leases. Rent-stabilized tenants keep their protections when a building changes hands. Owners of most residential buildings must register with HPD every year, and a new owner must file a new registration after a sale. Owners of rent-stabilized apartments also register rents with HCR every year. Tenants and caseworkers can check HPD's online records to see who the registered owner and managing agent are.
Summary written by Bulwark from Commercial Observer’s reporting. The original story is at commercialobserver.com. This is general information, not legal advice.
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Photo: Andre Carrotflower, CC BY-SA 4.0