Some of the most iconic Manhattan shopping strips appear to have lost some of their cachet with retailers.
Average asking rents decreased for available spaces in 12 out of 17 commercial corridors in Manhattan from spring 2018 to spring 2019, with prices declining by as much as 25% on Madison Avenue, according to the Real Estate Board of New York’s biannual report released Wednesday.
Between 57th and 72nd streets on Madison Avenue, average asking rents fell to $1,039 per square foot from $1,390 last spring, the report said.
The price cuts on Madison Avenue appear to be fostering a healthier rental environment, according to REBNY, which notes that owners are also responding to vacancies by considering shorter-term agreements.
“Manhattan’s continued natural correction in retail rents is spurring deal-making across the borough’s top corridors as retailers reconsider new and existing ground floor spaces,” REBNY president John Banks said in a statement.
On Fifth Avenue between 49th and 50th streets, the average asking rent decreased 22% over the past year to $3,047 per square foot. REBNY analysts said persistent vacancies there can be attributed to the reluctance of some newer owners, who purchased properties at their peak, to cut their prices.
Lower on the avenue, between 42nd and 49th streets, average requested rates fell 20%, to $878 per square foot, the report said.
The average asking price grew most dramatically on 125th Street, where owners asked for $137 per square foot, 10% more than last spring, the report said. The debut of new spaces west of Fifth Avenue helped bring up that average, REBNY said.