- REAL ESTATE EDUCATION
- GIVING BACK
Fall 2020 Manhattan Retail Report
January 7, 2021
On March 7, 2020, New York State Governor Cuomo declared a State of Emergency due to COVID-19, placing restrictions on mobility and the operations of non-essential businesses. Since then, both property owners and retailers have been adjusting to new challenges posed by the pandemic, which are reflected in the Fall 2020 Manhattan Retail Report.
During the Fall 2020 Manhattan Retail reporting period, all 17 corridors experienced a decrease in average asking PPSF rents since Fall 2019, ranging from 1% to 25%. These decreases are historic, with 8 corridors experiencing their lowest price per square foot averages in at least a decade. While asking rents dropped significantly, taking rents are reported to be much lower, with some brokers citing average differences between asking and taking rents around 20%.
Increases in retail availabilities and feedback from both tenant and retail brokers indicate that we are in a tenant’s market. 11 corridors have witnessed an increase in available retail space ranging from 6% to 67% since Fall 2019 which reflects a substantial slowdown in Manhattan retail transaction volume and creates challenges in establishing overarching economic trends.
Some property owners are willing to provide tenant improvements and concessions, in addition to more creative deal making, including shorter lease agreements and percent-of-sales rent offerings in the near-term. The current market provides ample opportunity for retailers seeking entrance to the Manhattan market and exemplifies landlords' increased flexibility during these uncertain economic times.