Manhattan retail lease rebound continues, but prime storefronts remain

Manhattan retail lease rebound continues, but prime storefronts remain

Manhattan retail leasing rebounded neatly from the pandemic and continues to strengthen, according to an in depth survey by the Real Estate Board of New York. 

Many fewer storefronts in 16 prime “corridors” tracked by the group had been vacant in the second half of 2025 than in the earlier six months as Soho, Flatiron and higher Madison Avenue bucked the pattern of stagnant or falling rents.

But the enchancment may not be instantly seen because the areas with the most  vacancies embrace the highest-profile, heavily-trafficked elements of city — Times Square, Herald Square and Fifth Avenue above East forty ninth Street. Weaker demand in those districts can provide the impression of a Manhattan leasing market softer than it truly is.

Manhattan retail leasing rebounded neatly from the pandemic and continues to strengthen, according to the Real Estate Board of New York.  Christopher Sadowski

The surge touches many elements 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 strong demand from worldwide luxurious manufacturers, expansions by local 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,” said Keith DeCoster, vp of market data and coverage.

He added that the return-to-office and residential conversion tendencies will elevate 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 said.

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 common asking rents 32% below their overheated peaks during the earlier decade, they really rose in a number of areas. Broadway in Soho noticed a whopping 24% improve in common asking rents in contrast with the first half of last 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 in 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 the borough’s accessible storefronts and have 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, including a number of such as 697-703 Fifth Ave. that 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 – inventory.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 told The Post. “Some  vacancies are tied to consolidations in luxury retail.” 

He famous that despite sluggish leasing, a number of marquee manufacturers such as LVMH and Gucci have purchased their properties, signifying long-term dedication. Meanwhile,  Rolex will soon launch a spectacular new retailer in its nearly-finished new headquarters tower at 665 Fifth Ave.

Times Square, which has acres of fast-casual meals but has yet to see a lot precise retailer  leasing, “is in transition. It’s still working out its identity,” DeCoster said.

Herald Square had 25 darkish storefronts, more than in any other space lined in the report. Average asking hire fell by 14% from $447 to $383 — the lowest in the last 10 years.

But the busy buying mecca anchored by Macy’s bought a elevate with the new, 40,000-square-foot lease for TJ Maxx at Herald Towers we reported last week — too late to be included in the report.

Herald Square had 25 darkish storefronts, more than in any other space lined in the report. Average asking hire fell by 14% from $447 to $383 — the lowest in the last 10 years. Helayne Seidman

Among the survey’s other findings:

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