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Fashion and food tenants helped boost Manhattan’s retail rents in the first quarter of the year, although activity was still below pre-pandemic levels. As a CBRE Report.
According to CBRE, which tracks leasing activity on a quarterly basis, the combined leasing pace over the past four quarters has reached 2.8 million square feet.
From the fourth quarter of 2022 to the first quarter of this year, rents rose 3.7 percent per square foot at 638, and tenants are starting to pay those prices.
On average, retailers in the 16 major Manhattan retail corridors CBRE measured signed leases for 75.5 percent of landlord asking rents, up 3.1 percent from the previous quarter, as the number of spaces in the borough declined.
“The inventory in these major markets is so depleted that the remaining space is at a premium,” he said. Hiro Imazumi, CBRE’s Field Research Manager. “I think they’re trying to do everything they can to secure the last remaining space, even if the tenants have to pay closer to asking.”
Union Square and the Flatiron District’s combined occupancy rate fell 46.2 percent quarter-over-quarter to seven open storefronts, as retailers snapped up 100,956 square feet in the first quarter. Those discounts were controlled by clothing stores, incl Abercrombie and FitchLease for 6,700 sq.ft 139 Fifth Ave And J. CrewA 27,000 sq. ft. renovation by 91 Fifth Ave.
Fashion retailers also dominated the Plaza District, which saw the second-highest neighborhood leasing volume in Manhattan at 91,789 square feet in the first quarter. Louis VuittonS Parent company LVMH It took 43,500 square feet as if 4 East 57th Street and a clothing brand Burberry for 14,700 square feet in 693 Fifth Ave When it refreshes 9 East 57th Street Store.
Without delay, Soho has seen color deals with a handful of clothing brands in the neighborhood of fast fashion brands. H&M 18,000 sq.ft 591 Broadway, Abercrombie and Fitch 9,000 sq.ft 547 Broadway And led For the first time in its history, it opened its New York City store. as if 149 Spring Street.
But New Yorkers He doesn’t eat Vogue instead of dinner. Manhattan also saw strong restaurant leasing, with food and beverage tenants taking 41 deals in the first quarter totaling around 150,000 square feet.
Included. Aqua Restaurant GroupLease of 26,000 square feet in 902 Broadway in Union Square, Gentlemen’s Club Score Agree to a 9,000 square foot sports bar at 416 Eighth AveAnd SA Hospitality GroupRenovation of the 8,600 square foot restaurant Lever House as if 390 Park Ave.
because of Supply chain problems Making it more difficult for new restaurants to acquire equipment, demand for second-generation restaurant space has increased, Imazumi said.
“They’re looking for places with existing construction, so all the major food and beverage places in the city are leased, so there are very few left,” Imaizumi said.
Despite strong leasing in the first quarter, Imazumi expects deals to slow in 2023. Increase in consumer prices And Low job growth Imaizumi said, hurting retailers, hampering spending.
“Especially for the last two years, people have been locked in, so people are having fun going out and spending money,” Imazumi said. But we don’t know how long this will continue, especially with so much economic uncertainty.
Celia Young can be found at cyoung@commercialobserver.com.
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