Retail: Rents Keep Climbing in Manhattan

Topped off by the Fifth Avenue corridor running from 49th Street up to Central Park, retail space in Manhattan has grown substantially more costly compared to the same period last year, according to recently-issued research from the Real Estate Board of New York. In key districts, asking rents for ground-floor retail space have increased as much as 51%.

“Building owners remain optimistic that the favorable market for retail leasing will continue despite the softening economy,” says Steven Spinola, REBNY president, in a prepared release. “We are still seeing high asking rents in the selected retail corridors.” He adds that the latest edition of the report has added new primary retail corridors “to correspond with interest by high-profile retailers in locating to these areas, including 86th Street on the Upper East Side and Columbus Avenue on the Upper West Side.”

On major shopping corridors, the steepest increases have occurred on Third Avenue between 60th and 72nd streets, where asking rents for ground floor space were up 51% to an average of $329 per sf in the six-month period ending March 31, 2008 compared to $218 in March 2007. In the Flatiron District on Fifth Avenue between 14th and 23rd streets, asking rents were up 50% to $401 per sf, compared to $267 in March ’07.