Fall 2021 Manhattan Retail Report

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Highlights

1. Manhattan Retail Market Heading in the Right Direction: Key market metrics – foot traffic, retail sales, tourism levels and hotel occupancy – remain below pre-pandemic levels but are heading to higher levels.
2. More Leases & Lengthier Commitments: Tenants responded to strong evidence of rising demand, committing to more leases with lengthier commitments.
3. Discounted Rent & Lease Flexibility: Brokers noted that tenant improvement and lease flexibility are still prevalent. Compared to the Fall of 2019, there are twice as many spaces with an average rent under $300/PSF. Times Square registered its lowest rent in more than a decade. 
4. COVID-19 Variants Present Risks to Foot Traffic; High Benefits to Return to Office, Increased Tourism: The retail market is poised to make another step forward, assuming that COVID-19 variants are contained and quality-of-life issues are addressed. The level of return of office workers in 2022 remains to be seen and is essential to several key retail districts.