- Long Island’s office vacancy rate fell 90 basis points year over year to 11.8% in the second quarter, the first reading below 12% since mid-2020.
- Sublease vacancy dropped to 2%, net absorption reached nearly 360,000 square feet in the first half, and Western Nassau vacancy hit just 9.7%.
- Overall asking rents slipped while Class A rents climbed, showing the flight to quality reshaping office markets nationally is playing out in the suburbs too.
Long Island office vacancy fell 90 basis points year over year to 11.8% in the second quarter, according to a Cushman & Wakefield report covered by GlobeSt. The reading marks the first time the market has dipped below 12% since the second quarter of 2020.
Western Nassau stood out, posting a vacancy rate of just 9.7% at the end of June.
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Back Below Pre-Pandemic Levels
Many office markets across the country are still chasing a return to pre-pandemic conditions. Long Island is now closer than most, with vacancy back under a threshold it last saw in mid-2020.
The shadow supply that weighed on many markets is also shrinking. Sublease vacancy fell to 2%, its lowest level since the start of the pandemic, per Cushman & Wakefield.
The Details
Net absorption stayed positive at 359,529 square feet in the first half of 2026 and outpaced new supply for the second straight quarter. Office deal volume rose 2.9% to 822,935 square feet over the same period.
Leasing split almost evenly between the two counties, with Nassau accounting for 49.8% of volume and Suffolk for 50.2%. Microchip Technology signed the largest lease, a 73,500-square-foot deal in Hauppauge, followed by Grassi & Company’s expansion to 40,620 square feet in Jericho.
On the sales side, NYU Langone paid $135.5 million for a property in Melville, where it plans to demolish the existing office buildings and build a hospital.
Long Island Office Rents Split by Class
Average asking rents slipped 14 cents per square foot from the prior quarter to $33.35. Eastern Nassau saw the steepest decline, with rents falling 40 cents.
Class A space moved the other way, rising 40 cents to $37.71 per square foot. The office gains add to broader momentum on the Island, where industrial leasing surged as vacancy tightened.
Why It Matters
The divergence between overall and Class A rents shows the flight to quality that has defined office markets since the pandemic is not limited to major downtowns. Tenants on Long Island are paying up for top-tier space while older buildings compete on price.
The same pattern has driven leasing in Manhattan, where SL Green signed nearly 1.8 million square feet of office leases. The NYU Langone deal also highlights another path for older suburban office stock: redevelopment into uses such as healthcare.
What’s Next
With absorption outpacing new supply for two straight quarters, watch whether vacancy keeps edging lower in the second half. Western Nassau’s sub-10% rate could put upward pressure on rents in that submarket.
Softer rents in Eastern Nassau suggest landlords of older product may need to keep competing on price, even as the overall market tightens.
