NYC retail leasing shows signs of rebound after COVID carnage

It might be too early to pop the Champagne corks, but Manhattan’s big-picture retail leasing scene shows strong signs of putting the pandemic carnage behind it.Even before anyone heard of COVID-19, online shopping depressed demand for brick-and-mortar stores by perhaps 10%.Lockdowns made things worse.Readers of this column know we’ve been skeptical about surveys claiming a big turnaround.

Reliable data for retail is harder to come by than for offices.As JLL power-broker Richard Hodos drily put it, “It isn’t an exact science.”But there seem to be reasons to justify landlords’ and brokers’ growing confidence in a healthier market.Both JLL and Cushman & Wakefield’s third-quarter Manhattan surveys found significantly lower storefront availability — 14.7% and 13.9% respectively, compared with peaks in the mid- and upper-20% ranges in 2021.JLL claimed the amount of available store space in the city “fell to its lowest level on record,” which is hard to swallow for anyone who’s strolled through the Flatiron District, which was rocked by the closing of several big-box stores.It all depends on how and what you count.

CBRE said retail leasing was actually down 25% compared with 3Q in 2023.But more than enough recent transactions give credibility to the idea that the worst is over.Cushman superbroker Joanne Podell said, “Activity in most trade areas is really robust.What’s interesting is, I think we are at equilibrium.

I don’t think you can define what we are experiencing as either a landlord or a tenant market.”Hodos said, “It’s been a good year in general for most retail corridors.Rents are lower than pre-pandemic and occupancy costs are more in line with operating costs.” Morning Report and Evening Update: Your source for today's top stories Please provide a valid email address.

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