Billions Flow Into NYC’s Trophy Assets: What It Means for Owners and Investors

Industry News
Aug 22
4 min read

By Robert Khodadadian, Skyline Properties

The first half of 2025 reaffirmed what many of us at Skyline Properties already know: when it comes to New York City commercial real estate, quality assets continue to command capital. Investment sales totaled $13 billion in the first six months of this year, with more than half concentrated in what I call the city’s “Fabulous Four” asset classes—Class A and trophy office, free market multifamily, affordable housing, and retail.

These categories don’t just attract capital; they define the future of our market. At Skyline, we’ve seen first-hand how institutional players, private investors, and even major tenants are gravitating to these assets as safe, long-term bets in a shifting economy. Our own recent closings across Manhattan and Brooklyn reflect exactly the same themes we’re seeing citywide.

Trophy & Class A Office: Flight to Quality Driving Leasing and Investment

Office sales surged to $3.1 billion, up 116% year-over-year, with 74% of that volume concentrated in Class A and trophy towers. This is no surprise. Creditworthy tenants want premier locations and best-in-class amenities to foster company culture and recruit top talent.

We’ve watched firms like Deloitte, Jane Street, and Apollo lease nearly 3 million square feet in these assets, driving vacancies down from 17.2% to 10.7% in just six months. Equity partners and lenders are equally enthusiastic. Roughly 60% of 2025’s office transactions involved recapitalizations, partial interest sales, or joint ventures—signals of conviction in the durability of these properties.

At Skyline, we’ve been directly involved in advising office owners who are recapitalizing instead of selling outright, a trend that preserves long-term upside while still welcoming new capital. In fact, one of our most recent office closings involved a Midtown Class A building where we secured a buyer willing to structure a creative joint venture—exactly the kind of deal flow defining the office sector today.

Free-Market Multifamily: Rent Growth and Institutional Confidence

Multifamily continues to be one of the most resilient asset classes. In 1H 2025, sales hit $4.4 billion, with free-market properties making up 57% of the activity. With housing supply perpetually tight, vacancy has compressed to 2.25%, pushing rents higher and signaling that the market has not only stabilized but is primed for long-term growth.

This year Skyline successfully closed on several free-market multifamily buildings in Manhattan and Brooklyn, with investors eager to step in while pricing is still below peak levels. These buyers see the same opportunity we do: strong rent growth, limited supply, and long-term appreciation.

One of our recent Brooklyn walk-up sales drew more than a dozen offers within days—proof that even smaller-scale free-market properties are in demand, especially when protected by favorable tax classifications. On the larger end, Skyline helped arrange the sale of a deregulated multifamily property in Manhattan that is already benefiting from significant turnover and repositioning potential.

Affordable Housing: Incentive-Driven but Critical

Affordable housing represented 20% of multifamily sales this year, largely because of public incentives and partnerships. Without these programs, preservation and new development simply aren’t viable.

The recent sale of a 602-unit complex in Far Rockaway underscores this point. Not only did the buyer secure a new regulatory agreement with HPD, but they also committed to rehabilitating a beachfront property that has endured decades of deterioration. Deals like this show how mission-driven investors can align profitability with social impact.

At Skyline, we’ve been active in structuring affordable housing transactions where owners are weighing their options: recommit under regulatory agreements or exit the asset. Our role has been to help sellers maximize value while ensuring transactions move forward smoothly under these complex frameworks.

Retail: Prime Locations, Brand Control

Retail may not be the largest volume sector, but when deals happen, they make headlines. The first half of 2025 saw $1.3 billion in retail trades, dominated by flagship acquisitions from owner-user tenants.

Uniqlo paid $355 million for its Fifth Avenue flagship, while Ralph Lauren secured its SoHo store for $132 million. These brands understand the value of control—they’d rather own than renegotiate escalating leases.

At the same time, institutions are still buying prime retail corridors. Acadia Realty Trust’s $60 million acquisition of properties on North 6th Street in Williamsburg, anchored by tenants like Abercrombie and Lululemon, demonstrates continued investor appetite for well-located, brand-driven retail.

Skyline has also completed multiple retail-focused transactions in Manhattan this year, including mixed-use assets with strong ground-floor tenants. These deals highlight the long-term value of well-located retail—especially when paired with residential or office components.

The Takeaway: A Flight to Quality

The through-line across all four sectors is clear: capital is flowing toward quality. Whether it’s a trophy office tower, a stabilized multifamily asset, or a flagship retail location, today’s market rewards owners who control premier real estate in irreplaceable locations.

At Skyline Properties, our recent closings and ongoing pipeline reinforce the same trend: buyers, sellers, and lenders are no longer chasing volume—they’re chasing certainty. The first half of 2025 has only reinforced this truth: investors, lenders, and tenants alike are voting with their capital, and they’re betting on the best.