Tourists flocking to New York City are driving a retail spending surge in Manhattan, which in turn, is boosting the retail real estate industry, the Wall Street Journal reported. Spending has increased 47 percent over the last five years, and a total of $52.4 billion will pour into the retail industry in 2012.
Tourists are especially drawn to trendy designer stores along Fifth and Madison avenues and boutiques in Soho. The growth in spending is also linked to new real estate developments and an increase in well-heeled Manhattan residents. Faith Hope Consolo, chairman of the retail leasing and sales division at Prudential Douglas Elliman, told the Journal that more new stores opened around New York in the last three years than had opened in the previous 10 years combined.
That’s provided a boon to the local real estate industry that other markets have lacked. “It’s New York,” Consolo said. “And then it’s the rest of the world.”
As The Real Deal previously reported, the retail sphere has also become an important source of revenue for brokerages trying to diversify their income base since the onset of the recession. In addition, the city will play a part in bringing millions of square feet of retail development down the line. [WSJ]