New York City Retail Leasing Surges in Q4
Driven by luxury and essential retailers, the surge in leasing is not enough to move the needle on availability.
Experiencing the largest rent decrease in five years, rents across all of New York City’s prime retail corridors dropped by 13.5% year-over-year on average, according to a new report from JLL Research.
However leasing velocity continues to trend upwards, increasing by 24.1% quarter-over-quarter in Q4. Essential businesses continue to drive leasing, accounting for 56.7% of new deals signed, a trend that has been observed since pre-COVID.
The rent decrease in five years also accounted for the sizable increase in deal volume: Although total deal volume is still down 31% from the same period in 2019, Q4 accounted for the highest quarterly deal count since Q1 2020.
Average Availability Inches Downward
Average availability continues to inch downward, coming in at 27% in Q4, down very slightly from 27.1% in Q3.
“Once again, the good news here is the way things are trending: the previous peak of 27.9% observed in Q2 2021 was the highest rate in the last 10 years, so it’s evident that conditions are continuing to improve,” JLL said.
“There is a direct correlation between increased leasing activity and decreased availability, as retailers continue to capitalize on tenant-favorable market conditions to secure high-quality space for cheap.”