The bulk of major retail corridors in Manhattan have seen high annual jumps in average asking rents — as much as 55 percent compared to the same period last year, according to a Real Estate Board of New York retail market report issued today.
The gains are the result of demand from domestic and international retailers looking for Manhattan addresses, which are in limited supply, as well as a booming year for tourism, said the trade group, which called the retail market one of the healthiest sectors in the city.
The Times Square area — defined as Broadway and Seventh Avenue between 42nd and 47th streets — posted the largest gain in asking rents between spring 2012 and spring 2013. This past spring, rents jumped 55 percent to $2,175 per square foot from the $1,400 per square foot tallied in the same season last year.
Since last fall, limited spaces in prime zones and rising asking rents have led retailers to other areas, expanding the boundaries of established high-end corridors, REBNY said.
For example, the stretch of Broadway between 14th and 23rd streets in the Flatiron District posted the next largest year-over-year increase in average asking rent: 50 percent, to $322 per square foot from $215. The strip was also a beneficiary of the Midtown South office market, which has brought about more foot traffic and demand for high-quality retail, the report said.
Another Example Is Fifth Avenue between 42nd and 49th streets, where average asking rents rose 21 percent from last spring to $1,092 from $900.
Other than these expanded zones, Upper Fifth Avenue, known as a prime retail corridor, also saw gains. The area saw an 11 percent increase in average asking rent from spring 2012 to $3,052 per square foot from $2,750.
“Rising asking rents in traditionally prime corridors such as Upper Fifth Avenue are indicative of a strong market,” REBNY President Steve Spinola said in a statement.
However, despite the nearly across-the-board annual increases in average asking rents, two select major corridors saw decreases.
One of them was the Meatpacking District — known for its trendy selection of boutiques — which slipped 5 percent in spring 2013 to $356 per square foot from $375. Also, Broadway between 72nd and 86th streets fell 11 percent to $297 per square foot from $332 from last spring. —Zachary Kussin