Manhattan retail lease rebound continues, but – Business News
Manhattan retail leasing rebounded neatly from the pandemic and continues to strengthen, based on a detailed survey by the Real Estate Board of New York.
Many fewer storefronts in 16 prime “corridors” tracked by the group had been vacant within the second half of 2025 than within the earlier six months as Soho, Flatiron and higher Madison Avenue bucked the trend of stagnant or falling rents.
But the advance won’t be instantly seen as a result of the areas with essentially the most vacancies embody the highest-profile, heavily-trafficked components of city — Times Square, Herald Square and Fifth Avenue above East forty ninth Street. Weaker demand in these districts can provide the impression of a Manhattan leasing market softer than it really is.
Manhattan retail leasing rebounded neatly from the pandemic and continues to strengthen, based on the Real Estate Board of New York. Christopher Sadowski
The surge touches many components of Manhattan. Union Square Partnership government director Julie Stein famous the district “finished 2025 with a formidable 91% storefront occupancy rate. It remains a primary destination for brands that want to be at the intersection of local authenticity and global tourism.”
The REBNY survey of the second half of 2025 cited sturdy demand from worldwide luxurious manufacturers, expansions by native names, food-and-beverage tenants and an inflow of health-and-fitness tenants that helped make up for the shortfall of conventional shops.
“Despite its challenges, Manhattan’s retail market continues to demonstrate a broad-based appeal,” stated Keith DeCoster, vice president of market knowledge and coverage.
He added that the return-to-office and residential conversion trends will carry retail boats going ahead.
Cushman & Wakefield government vice chair Joanne Podell shared his optimism.
“Brands continue to view the city as the premier market to establish a retail presence, introduce new concepts and strategically grow their business,” she stated.
No swift change is in sight as, “many storefronts will require extensive planning and substantial commitments” by retailers, REBNY famous. William Farrington
Although REBNY cited average asking rents 32% beneath their overheated peaks during the earlier decade, they really rose in a number of areas. Broadway in Soho noticed a whopping 24% increase in average asking rents in contrast with the primary half of final yr.
Storefront availability is tightest in Soho, higher Madison Avenue, Flatiron, decrease Fifth Avenue, and the West Village, REBNY discovered. Only 13 storefronts had been on the market alongside Madison Avenue between East 57th and East 86 streets – in contrast with 35 two years in the past.
But the report cited “inconsistent” demand within the highest-profile areas, the place some vacancies have “lingered on the market.”
Upper Fifth Avenue, Times Square, Herald Square and FiDi comprise a comparatively small portion of Manhattan’s retail stock. Yet, REBNY discovered, they account for 60% of all of the borough’s accessible storefronts and have essentially the most vacancies of over 10,000 sq. ft.
Eleven storefronts are up for grabs on Fifth Avenue from East forty ninth to East 59th, together with a number of reminiscent of 697-703 Fifth Ave. which have been empty more than a yr.
Storefront availability is tightest in Soho, higher Madison Avenue, Flatiron, decrease Fifth Avenue, and the West Village, REBNY discovered. deberarr – stock.adobe.com
No swift change is in sight as, “many storefronts will require extensive planning and substantial commitments” by retailers, REBNY famous.
“Upper Fifth is going through extensive re-imagining,” De Coster advised The Post. “Some vacancies are tied to consolidations in luxury retail.”
He famous that regardless of sluggish leasing, a number of marquee manufacturers reminiscent of LVMH and Gucci have purchased their properties, signifying long-term dedication. Meanwhile, Rolex will quickly launch a spectacular new store in its nearly-finished new headquarters tower at 665 Fifth Ave.
Times Square, which has acres of fast-casual food but has but to see a lot precise store leasing, “is in transition. It’s still working out its identity,” DeCoster stated.
Herald Square had 25 darkish storefronts, more than in some other space coated within the report. Average asking rent fell by 14% from $447 to $383 — the bottom within the final 10 years.
But the busy procuring mecca anchored by Macy’s acquired a carry with the new, 40,000-square-foot lease for TJ Maxx at Herald Towers we reported final week — too late to be included within the report.
Herald Square had 25 darkish storefronts, more than in some other space coated within the report. Average asking rent fell by 14% from $447 to $383 — the bottom within the final 10 years. Helayne Seidman
Among the survey’s different findings:
Fitness/wellness tenants signed some of final yr’s largest “retail” leases, due partially to the discontinuation of town’s special-permit requirement for such makes use of as gyms, martial arts studios and licensed therapeutic massage clinics. It opened the door to large-scale leasing by Equinox, Life Time and others.
Tightened availability in main downtown neighborhoods pushed smaller retailers into Noho, Nolita, Union Square and the Madison Square Park areas, whereas these needing bigger footprints turned to Chelsea, Hudson Square and Tribeca.
Available areas transfer swiftly in Soho, the place Abercrombie & Fitch took the previous Lululemon space at 520 Broadway, and on higher Madison, the place Jacob Cohen leased the previous Michael Kors location at 792 Madison.
Restaurants stay a market driver, reminiscent of steakhouse STK’s lease for 12,000 sq. ft for its fourth Manhattan location at 412 W. fifteenth St.
