Global law firm Simpson Thacher & Bartlett has signed one of Manhattan’s largest office leases this year, a deal that adds momentum to what could become the market’s strongest year since 2000, according to a Colliers report.
The firm last month signed a 916,000-square-foot lease at 570 Fifth Ave., making it the largest transaction completed in May, Colliers said. The property is Extell’s roughly million-square-foot mixed-use tower under construction between West 46th and 47th streets. The project is also expected to include an approximately 80,000-square-foot Ikea store after Ingka Investments — the investment arm of the group that owns most Ikea stores globally — disclosed backing the development.
Extell and Simpson Thacher did not immediately respond to CoStar News’ separate requests for comment.
Thacher's lease spans about 25 years and covers 25 full floors — from the fourth through 20th and 22nd through 30th floors — along with ground-floor and below-grade space, according to a public document filed with the city Department of Finance. The agreement also includes two 10-year extension options, as well as restrictions on competing law firms and certain retail uses within the building.
Simpson Thacher is currently based at 425 Lexington Ave., between 43rd and 44th, where it occupies about 542,000 square feet, according to CoStar data.
The deal comes as law firms, driven by a continued flight to quality, have “dramatically increased their presence in the premium office market,” accounting for 21.7% of U.S. office leases signed above $100 per square foot in the first quarter, according to JLL. The sector has also been a key driver of high-end demand in Manhattan.
Among the five largest Manhattan office leases signed last month, global law firm Baker McKenzie inked a 121,833-square-foot renewal and expansion at 10 Bryant Park.
Google renewed its 411,000-square-foot lease at 315 Hudson St., while CNBC parent Versant signed a 249,000-square-foot renewal and expansion at 229 W. 43rd St. Engineering firm HDR’s roughly 74,400-square-foot lease at 7 Penn Plaza rounded out the top five.
Manhattan’s year-to-date leasing activity totaled 19.63 million square feet, up about 10% from the same period a year earlier. If demand continues at this pace, 2026 could see the market’s highest annual leasing volume since 2000, Colliers said.
“The rate of recovery in the Manhattan office market continued in May at a remarkable pace,” said Franklin Wallach, executive managing director of research and business development for Colliers in New York. “Taken together with the healthy leasing volume earlier in the year, there is the potential for 2026 recording the strongest yearly demand in a quarter century. All the while, supply and pricing continue to migrate closer to their pre-pandemic levels.”