Hudson Yards, the $25 billion development that was supposed to herald a new era for Manhattan’s west side, is confronting an uncomfortable reality: the gleaming office towers that anchor the complex cannot find enough tenants to fill them.
New data from commercial real estate firm CBRE shows office vacancy at Hudson Yards has reached 28 percent, up from 19 percent a year ago and roughly double the rate that prevailed when the development opened in 2019. The numbers represent the highest vacancy in the complex’s history.
“Hudson Yards was designed for a world that may no longer exist,” said Ruth Colp-Haber, CEO of commercial real estate firm Wharton Property Advisors. “The trophy office market is suffering everywhere, but nowhere more visibly than here.”
The development’s challenges reflect broader troubles in Manhattan’s commercial real estate market. Office vacancy citywide sits at approximately 17 percent, the highest level since the 1990s. But Hudson Yards’ premium positioning makes its struggles particularly stark.
When the complex opened, developers Related Companies and Oxford Properties Group marketed Hudson Yards as the future of New York office space: brand-new construction with state-of-the-art systems, abundant amenities, and views that older buildings cannot match. Rents exceeded $100 per square foot, among the highest in the city.
Major technology and media companies signed long-term leases. Facebook, Warner Media, and BlackRock committed to large floor plates, lending the development blue-chip credibility. The towers filled quickly, appearing to validate the massive investment.
Then came the pandemic, followed by the technology industry’s dramatic retrenchment. Facebook, now Meta, drastically reduced its office footprint nationwide. Warner Media, acquired by Discovery, consolidated operations elsewhere. Other tech tenants, having overpaid during the boom years, sought to sublease space they no longer needed.
“Tech was supposed to be the anchor,” said Mary Ann Tighe, CEO of the tristate region for CBRE. “When tech retrenched, Hudson Yards felt it more than anywhere else because they were so heavily concentrated there.”
The sublease market has become particularly challenging. Companies holding expensive long-term leases are offering space at discounts of 30 percent or more, competing directly with landlords trying to fill direct vacancies. The oversupply has pushed effective rents down significantly from their peaks.
Related Companies has disputed characterizations of Hudson Yards as struggling, pointing to recent leasing activity and long-term commitments from anchor tenants like BlackRock.
“Any suggestion that Hudson Yards is in trouble is simply incorrect,” said a company spokesperson. “We continue to attract world-class tenants and remain confident in the long-term value of what we have built.”
But commercial real estate analysts note that even successful properties feel pressure when the broader market weakens. Hudson Yards’ heavy debt load and complex financing structure leave less margin for error than at older, fully paid-off buildings.
The development’s office challenges contrast with its retail and residential components, which have performed better. The Shops at Hudson Yards have maintained strong foot traffic, and luxury condominiums at 15 Hudson Yards have sold well despite high prices.
“The mixed-use model is proving out,” Colp-Haber said. “But offices were supposed to be the engine, and that engine is sputtering.”
For the surrounding neighborhood, Hudson Yards’ struggles ripple through local businesses that depend on office worker spending. Restaurants and retailers along 10th and 11th Avenues report slower lunch traffic and reduced evening foot traffic compared to pre-pandemic projections.
City officials are monitoring the situation, mindful that Hudson Yards received substantial public subsidies including infrastructure investments and tax abatements. Critics have long questioned whether taxpayers received adequate return on those commitments.
“We built a subway extension and rezoned entire blocks for this development,” said Councilmember Erik Bottcher, whose district includes Hudson Yards. “The public has a stake in seeing it succeed.”
Looking ahead, the development’s fortunes will likely track the broader office market’s recovery. Some analysts expect consolidation to stabilize vacancy rates by late 2026, while others predict permanent shifts in how companies use space.
“The trophy office is not dead,” Tighe said. “But it is being redefined. The companies that will pay premium rents want more than a nice view. They want amenities, flexibility, and proximity to talent. Hudson Yards has some of those things, but so do competitors.”
For now, the development that was supposed to prove that New York could build grand things in the 21st century must prove something more modest: that it can fill its buildings.
