The difference in how new office space is being delivered in London and New York City has widened to its most pronounced level in more than two decades. Data released by CoStar Group shows that, by the end of 2025, over 16 million square feet (msf) of office space was under construction in London, compared with 5.7msf in New York City.
The scale of this gap reflects a shift in how projects are advancing in each market, with construction volumes moving in different directions despite continued demand for high-quality space.
London maintains a steady construction pipeline
Office construction activity in London has remained within a relatively narrow range since early 2022. Volumes have largely fluctuated between 16 and 17 msf, marking a sustained period of elevated development compared with earlier years when levels below 14 million square feet were more typical.
This continuity has resulted in London holding a substantial lead over New York City. By the second half of 2025, the difference between the two markets exceeded 10msf, the largest margin recorded in London’s favour in over 20 years.
Preliminary figures for the first quarter of 2026 indicate that construction levels in London have dipped below 16msf for only the third time since 2021. Further reductions are expected through 2026 and 2027, suggesting that the current pipeline may begin to moderate after an extended period of stability.
New York shifts towards pre-leased development
In New York City, the volume of office space under construction has declined significantly from its earlier peak. In 2018, the city’s development pipeline was more than double that of London. By the end of 2025, however, total construction stood at 5.7msf, among the lowest quarterly levels recorded this century.
The data indicates a change in how projects are being brought forward. According to CoStar, developers have become increasingly cautious about advancing speculative schemes. New construction activity is now more closely tied to pre-leasing, with projects typically progressing once anchor tenants are secured.
This approach has coincided with continued leasing activity at the upper end of the market. In 2025, 59 transactions exceeding 100,000ft2 were completed in New York City, amounting to more than 14msf, the highest level recorded since 2019.
A gap that may begin to narrow
While the divergence between the two cities reached a record level in 2025, early indications suggest that the difference may not remain at its current scale. Initial data for 2026 points to a gradual easing in London’s construction volumes, which could reduce the gap over the coming years.
The current figures capture a moment where both markets continue to support demand for large-scale office space, yet the pace and conditions under which new supply is delivered differ. London’s pipeline reflects a period of sustained construction activity, while New York City’s development cycle is increasingly linked to confirmed occupier demand.
