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NYC’s retail market tightens, beats pre-pandemic rates

Madison Avenue boasts historic low availability: JLL

NYC’s Retail Market Tightens in First Quarter
(Illustration by The Real Deal with Getty)

New York City’s retail landscape grew tighter in the first quarter.

On average, only 15.4 percent of retail space was available from January to March, according to Crain’s. The data comes courtesy of JLL, which releases a quarterly report on the market.

There were 212 total available retail spots for that quarter, representing a small drop from the 219 available spaces of the previous quarter.

Contrast this with the market during the height of the pandemic, and the difference is stark. In 2021, the availability rate peaked at 28 percent. The market is even tighter than it was before the pandemic: the average availability rate in 2018 was 21 percent.

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Nowhere is the market’s shift more apparent than on Madison Avenue between East 57th and East 72nd streets. The availability rate for the iconic corridor dropped to 5.9 percent, a record for the stretch. JLL’s Patrick Smith attributed the corridor’s performance to “the strength of luxury and luxury brands, along with a market perception of rents being discounted.”

The availability rate grew in some sections of the city. In the Meatpacking District between Ninth and 10th avenues and 14th and Gansevoort streets, the availability rate rose 6 percentage points year-over-year to 30.6 percent. The only area of the city with more availability was Herald Square, with a 35.2 percent rate.

The average asking rents on Upper Fifth Avenue and in Times Square increased year-over-year, but they decreased across the rest of the submarkets tracked, which were almost entirely in Manhattan. The average asking rent in the first quarter was $537 per square foot, also down from the previous quarter.

Upper Fifth Avenue also boasted the highest asking rent last quarter at $2,163 per square foot, while Soho was on the other end of the spectrum, at $281 per square foot.

Williamsburg was the lone Brooklyn neighborhood included in the report. The average asking rent was $303 per square foot and the availability rate was 9.6 percent in the neighborhood.

— Holden Walter-Warner

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