How Long an NYC Office Lease Runs, and Whether to Sign 3, 5 or 10 Years
A direct office lease in New York usually runs five to ten years, and five to seven is the norm where a whole floor is being built to the tenant's plan. When a landlord's proposal asks you to name a term, three years keeps the commitment short but earns little landlord money, five is the usual middle, and ten buys the most free rent and improvement allowance at the price of outliving your plan. For a growing company the better answer is rarely the longest term. It is a term you can forecast, plus the options and sublease rights that let you change course.
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Show me floors for 40Updated 2026-10-03 · Nomad Group
What a landlord means when the proposal asks for a term
The term is how the landlord gets its money back. Free rent, the improvement allowance and the brokers' commissions are all spent at the start and recovered from rent over the years that follow. A proposal with generous concessions will ask for a long term, and a tenant who wants a short one should expect the concessions to shrink with it.
So the number on the proposal is an opening position tied to a package. Change the term and the rest of the offer moves. The direct lease entry shows how the pieces fit together.
Three, five and ten years, side by side
- Three years. Short for a direct deal, and more likely on a smaller floor or one that is already built. Expect a modest allowance or none, and about three free months if the common shape of one month per year of term holds.
- Five years. The low end of the usual range for a full floor with a custom buildout, since a landlord will rarely fund a fit-out on less. It earns meaningfully more free rent and improvement money than three.
- Ten years. The largest package of all, and usual only on big floors with a major fit-out. The rent also escalates every year, typically by 2.5 to 3 percent, so the last years cost well more than the first.
What a long term costs a company that is still hiring
A lease is sized for the headcount you can see. Plan on 175 square feet a person, and a company with open roles commonly leases 15 to 25 percent above that. Past that margin a long term stops fitting. Outgrow the floor in year three of ten and you are paying for space that is too small while you look for more.
The concessions do not offset that. Free rent is used up in the first months, and the obligation is still there at the end. The floors below fit a team of about 40. On each, ask how many years ahead you can forecast the headcount that fills it.
Clauses that make five or ten years safer to sign
A longer term can be softened inside the lease, and each of these is easiest to win before signing:
- A renewal option with the rent method agreed, so that choosing a shorter first term does not mean losing the space.
- A termination option at a set date, for a fee that repays what the landlord has not yet recovered.
- A right of first offer on neighboring space, for the best case of the hiring plan.
- Sublet and assignment rights with consent not unreasonably withheld, so a floor you outgrow can be handed on.
Lease options defines each right, and the early exit guide prices leaving a lease that has none of them. Have your attorney confirm how each clause reads in the draft.
Floors that fit a team of 40
Live from our listings · 6 of the 13, smallest firstA team of 40 plans on about 7,000 square feet at 175 a person. 13 floors on our book sit in the range that fits, 7,000 to 12,600 square feet, asking $43 to $200 per square foot per year on the 11 with a published rent.
- Floors
- 13
- Sizes
- 7,047-12,500 sq ft
- Asking rent
- $43-$200 / sq ft
- 104 West 27th Street, Entire 9th Floor 7,047 sq ft $59/sq ft Chelsea about 40 people
- 237 West 27th Street, Entire 11th Floor 7,158 sq ft $44/sq ft Chelsea about 41 people
- 50 Greene Street, 3rd Floor 7,300 sq ft $98/sq ft SoHo about 70 people
- 66 Hudson Boulevard, Partial 53rd Floor 10,517 sq ft $200/sq ft Hudson Yards about 60 people
- 30 West 21st Street, Entire 9th & 10th Floors 10,562 sq ft rent on request Flatiron about 60 people
- 1239 Broadway, Entire 12th Floor 12,500 sq ft $62/sq ft NoMad about 71 people
The full guide
This page is the short answer. The long one, with the numbers worked through, is here:
Related topics
- Typical Commercial Lease Length in NYC, by Type of Office Deal
- Lease Administration for an NYC Office Tenant: Who Is Responsible After Signing
- Commercial Lease Administration: The One-Page Abstract and the Critical Dates
- Commercial Lease Security Deposit in NYC: Cash or a Letter of Credit
Should a startup sign a ten-year office lease?
Usually not for a first office. A ten-year term brings the biggest concession package, yet a young company can rarely forecast its headcount that far out, so the space is likely to stop fitting long before the lease ends. A shorter direct lease with rights to expand and to sublet, or a flexible floor as a first step, suits most growing teams better.
Will a landlord fund a buildout on a three-year lease?
Seldom in full, because three years is too short for an owner to recover much construction money. The realistic choices are a floor that is already built, a smaller allowance with your own money on top, or a higher rent that repays the landlord faster.
Can we sign five years and still leave in year three?
Only by a route the lease gives you. A termination option lets you end it on notice for a fee. Without one, the usual exits are subleasing the floor, assigning the lease, or negotiating a surrender with the landlord, and each has a cost. Settle those rights before you sign.
Does a longer term get us a lower rent?
Not usually the face rent, which landlords protect. What grows with the term is the package around it: more free months and a larger allowance. Compare a five-year and a ten-year offer on what each costs in total.
Talk to a broker
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