USA – NEW YORK Law and Practice Contributed by: Lindsey Haubenreich, Joseph Heins, Timothy Moriarty, Kimberly Nason and Matthew Fitzgerald, Phillips Lytle LLP
1. General 1.1 Main Sources of Law
The most significant real estate deals over the last 12 months also reflect this “flight to quality”. Among the marquee transactions was RXR’s approximately USD1.08 billion acquisition of 590 Madison Avenue, reported as the largest New York City office sale since 2022. In the multifamily sector, one of the larg - est 2025 trades was the sale of 800 Fifth Avenue for roughly USD810 million. These headline transactions, together with improving Manhattan office leasing and renewed investor appetite for prime product, suggest that liquidity has returned first to premier assets, while secondary assets continue to face valuation pressure and repositioning risk. Rising inflation and higher interest rates continued to weigh on pricing, construction starts and lever - age assumptions, although the environment became somewhat more constructive in late 2025. The Federal Reserve cut rates in September 2025, but by January 2026 it left rates unchanged and continued to charac - terise inflation as somewhat elevated; the PCE price index was still running at 2.9% in December 2025 and at 2.8% in January 2026. As a result, many New York developers and investors have adapted by using more equity, accepting lower leverage, extending maturi - ties, pursuing workouts where necessary, and increas - ingly relying on alternative capital sources, including private credit, for large transactions. 1.3 Proposals for Reform The most significant current proposal for reform in New York State is Governor Kathy Hochul’s 2026 “Let Them Build” agenda, which would amend the State Environmental Quality Review Act (SEQRA) to streamline housing and infrastructure approvals. The proposal would exempt certain housing projects from additional SEQRA review where they are already locally zoned and permitted, create clearer review deadlines, and impose a two-year outside limit for completion of an environmental impact statement in many cases. For developers and investors, the practi - cal effect would be to reduce entitlement risk, shorten pre-construction timelines and lower carrying costs on projects that often stall in the approval phase. The proposal appears to have meaningful support from the Governor and the State Senate, but not yet from the Assembly, so it is not certain to become law in its current form. If enacted, it would most likely come
Real estate law encompasses a broad range of skills and practice areas. To adequately represent a client, a real estate attorney must understand the nature of the client’s business and the client’s willingness to take risks. A real estate practitioner must understand the myriad of potential issues that may arise for a given real estate project (typically within tax, finance, corporate, securi - ties, environmental, energy and land use, bankruptcy, government relations, insurance and construction, among others) and have access to the breadth and expertise necessary to effectively represent clients in all relevant issues. To that end, most matters require a team approach, with lawyers who have differing expertise. In addition, practitioners must be resource - ful and have the ability to communicate and negotiate effectively. Current trends typically do not impact the skills required to practise real estate law; however, one must remain aware of them to effectively assist clients in moving their real estate projects forward. 1.2 Main Market Trends and Deals Over the past 12 months, the real estate market in New York State has shown a selective recovery rath - er than a broad-based rebound. In New York City, investment sales volume increased to approximately USD33.5 billion in 2025, with capital concentrating in higher quality assets and well-located properties, while older and less efficient buildings continued to lag. Office demand improved materially at the top end of the market, with trophy and amenity-rich buildings outperforming commodity office product, while obso - lete office inventory remained under pressure and continued to fuel interest in adaptive reuse. Industrial and logistics assets have remained comparatively resilient, supported by long-term e-commerce, distri - bution and advanced manufacturing trends, and state programmes such as FAST NY continue to push shov - el-ready industrial sites across Upstate New York. At the same time, the housing market continues to be shaped by supply constraints, and policy tools such as City of Yes, 485-x and 467-m have helped create a more favourable framework for new housing produc - tion and office-to-residential conversions.
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