Manhattan Retail Report - First Half 2025

Sustained Market Fundamentals, Even as Headwinds Emerge

Despite rising uncertainty in the broader economy, Manhattan’s retail rally carried into the first six months of 2025. Steady storefront leasing has depleted options in prime corridors, pushing retailers to expand their search geographically. Asking rent rose in most areas and owners pulled back on concessions.

Brokers noted that a few retailers proceeded more cautiously in the last two to three months, likely in response to economic uncertainty associated with federal policy changes. In addition, declining tourism ,particularly from Canada and Europe, has some retailers concerned.

It will take more than falling international tourism to derail the retail rally. For the time being, other market drivers, including domestic tourism, daytime commuters, and an affluent residential base, all continue to attract brands to Manhattan. Leasing is on par with the robust pace of the last two years because multiple retail brands value access to these core fundamentals. Demand continues to flow from multiple sources. Established New York City firms are expanding their footprint, international and domestic brands are making their debut, and digital retailers are opening their first stores.