- EBay signed a 28K SF lease at 122 Fifth Ave., making the building fully leased after a $100M redevelopment by The Bromley Cos., per Bisnow.
- Tech tenants, including Microsoft and Chime, now anchor the office property near Union Square, where Midtown South’s average asking rent was $84.37 PSF in March, per CBRE.
- The deal marks growing demand for Manhattan office space among tech and AI firms, with sector leasing volume outpacing prior years, according to The Wall Street Journal.
Motivated Leasing Fills Redeveloped Manhattan Towers
As tech companies push deeper into Manhattan, landlords are working aggressively to backfill vacancies left by pandemic-era tenant exits. Bisnow reports that The Bromley Cos. achieved 100% occupancy at 122 Fifth Ave. following a $100M overhaul, partially by designing plug-and-play spaces geared toward digital-first companies. Upgraded office stock is now a prerequisite for attracting tenants: buildings offering flexible layouts and strong amenity packages are seeing the highest absorption rates. With recent velocity among artificial intelligence and established tech tenants, Midtown South remains a focal point for CRE watchers tracking the office market’s recovery and product evolution.
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The Details
EBay’s 28K SF lease at 122 Fifth Ave. was brokered by CBRE’s Sacha Zarba, Frederick Fackelmayer, and Alice Fair for the tenant, and by Newmark’s David Falk, Peter Shimkin, Eric Cagner, and Dylan Weisman for the landlord. The lease fills the last remaining office availability at Bromley Cos.’ 300K SF asset, located steps from Union Square. 122 Fifth underwent a $100M redevelopment, including a second-floor redesign by Vocon. Other notable office tenants include Microsoft and fintech company Chime; retail tenants, such as Reformation, fill the ground-level space. While Bromley did not disclose specific rates, CBRE pegged Midtown South’s March average asking rent at $84.37 PSF.
Tech Tenants Accelerate Sector Recovery
Manhattan’s office leasing has found an engine in the technology sector, with AI-driven firms powering activity in 2026. The Wall Street Journal highlighted that artificial intelligence companies took more space in Q1 than during all of 2025. Major tech players are also expanding their city footprints to access New York’s talent pool, fueling a wave of office deals. That demand contrasts with owners pursuing residential conversions at older office properties, while top-tier workplaces continue attracting expansion-focused tenants. This trend isn’t confined to one building: Vornado Realty Trust brought its Penn 2 tower to 90% leased with new full-floor agreements from Altana AI and Veeva Systems. The rapid absorption speaks to a bifurcated market—while Class B and legacy assets struggle, best-in-class properties catering to tech needs are outperforming.
Why It Matters
The lease signals both the enduring appeal of Midtown South for national tech brands and the success of capital-intensive repositioning projects. CRE landlords betting on high-spec redevelopments—like Bromley at 122 Fifth—are attracting well-capitalized tenants when design aligns with user needs. While the broader Manhattan office market remains under pressure, best-in-class assets demonstrate resilience amid changing tenant preferences. According to CBRE, Midtown South’s average asking rent at $84.37 PSF offers a competitive middle ground between traditional Midtown and pricier boutique locations, making it attractive for expansion-stage tech firms. With major AI and fintech firms accelerating their NYC leasing, competitive tension is reemerging for well-located, newly improved assets. Office brokers now face a landscape of sector-specific migration, where experience-driven buildings outsell commodity office.
The eBay lease shows how targeted redevelopment can reduce market risk. Bromley Cos. did not wait for a broad office recovery. Instead, it created a product that matched tenant demand. The strategy attracted established firms like Microsoft and fast-growing companies like Chime. As a result, the building reached full occupancy after its redevelopment. This trend extends beyond one property. Trophy buildings and modernized assets continue to capture most new leasing activity in Manhattan. Meanwhile, older office properties still face slower demand. Tech companies remain a major driver of office leasing in the city. Therefore, investors are reassessing where they deploy capital across New York’s office market.
What’s Next
Strong leasing at prime buildings will push more owners to reposition aging assets or face longer vacancies. As Midtown South’s top properties fill up, landlords in nearby submarkets will face growing pressure to upgrade buildings and amenities. Competition for tech tenants will also intensify. AI, fintech, and e-commerce firms continue expanding and seeking move-in-ready offices in central locations. Meanwhile, investors will likely favor Class A redevelopments over outdated buildings. That gap could further reshape Manhattan’s office market as capital targets tech-driven growth and stronger returns.
