The outlook for New York City’s commercial real estate in 2026 appears exceptionally promising, at least when viewed through optimistic projections.

However, while this column has consistently championed positivity throughout the year, today, we take a moment to explore the challenges.

Let’s start with the encouraging developments. As we’ve frequently highlighted, several indicators suggest a robust and flourishing market. These include declining vacancy rates, a significant drop in available sublease space, a gradual increase in rental prices, and a noteworthy return-to-office surge that other U.S. cities can only envy.

Notably, there have been substantial expansions by prominent entities such as Jane Street Capital, Guggenheim, and Amazon. Bloomberg LP has also shown its commitment to New York by extending all three of its Manhattan leases through 2040. Additionally, new skyscrapers at 350 Park Avenue and 343 Madison Avenue have received the go-ahead. The city’s first $1 billion-plus building sale in half a decade occurred at 590 Madison Avenue.

Hotels are experiencing a boom, and the accelerated conversion of residential spaces is revitalizing the market by transforming numerous outdated Class-B properties.

So where’s the downside?

For all the planned new developments, too many prominent sites lie barren where developers wait on financing or anchor-tenant miracles that might never come.

London, the city that is New York’s primary competitor, doesn’t have half as many ugly holes in the ground with no plans filed as Manhattan does.

There are at least five of them on West 57th Street alone; on three blocks along First Avenue below the UN; several prime blocks of Midtown Madison and Park avenues; and on thriving Sixth Avenue between West 44th and 45th streets.

There are more empty holes and vacant lots downtown than can be counted — none more visible than the some-day site of Two World Trade Center. Until Larry Silverstein signs Amex or another anchor tenant to get the project off the ground, the 16-acre site’s recovery will remain achingly incomplete.

In the “not vacant but troubled” category are three prime chunks of cityscape.

The former Roosevelt Hotel’s future is way up in the air as owner Pakistan International Airlines fidgets over what to do with the empty hulk after JLL walked away from its sale-agent role last summer.

The beloved but antiquated Chrysler Building will continue to lose luster until landowner Cooper Union finds a developer that can afford the skyrocketing cost of the ground lease.

The South Street Seaport took on water after Howard Hughes Corp. spun it off into Seaport Entertainment Group. The Tin Building is scaling back; tacky “immersive” attractions encroach on home-grown restaurants; and the next-door lot at 250 Water St. is a question mark since SEG sold it off last summer.

The retail landscape falls well short of cheery surveys by the Real Estate Board of New York, commercial brokerages and business-improvement districts which cite reduced “availabilities” — but overlook what New Yorkers actually see.

The former Barneys at 660 Madison Ave. remains a dark hulk after six years. Brooks Brothers’ opening at 195 Broadway and Printemps at 100 Wall St. belie innumerable empty spaces nearby. “Prime Retail for Lease” signs are everywhere, and still seem to outnumber stores from Broadway on the Upper West Side to corridors in central Greenwich Village and Flatiron. There are even huge empty storefronts on Fifth Avenue in the East 50s and on East 42nd Street.

But perhaps the darkest cloud is environmental zealotry over “100-year flood” fears that would deny the five boroughs access to the historic basis for their current-day prosperity: the waterfront.

A southern portion of Battery Park City is already ruined by the “redesign” of Wagner Park. Even worse sea-wall construction is already past the planning stages at many river and harbor locations.

At this rate, even the Coney Island ocean might eventually be blocked from view.