Manhattan retail availability is plummeting — though that's not helping rents move in the right direction. In Cushman & Wakefield's third-quarter market report, availability dropped 140 basis points year-over-year to 12.5 percent. This, according to the brokerage, approaches "historic lows."
Madison Avenue (spanning East 57th-East 72nd Streets) has shown the most resilience in the category, with the submarket tightening by 21.8 percent since the peak in the third quarter of 2020. SoHo and the Meatpacking followed with 16.8 percent and 8.7 percent drops since that period, respectively.
Also, leasing activity has been strong, with more than three million square feet of retail signings in Manhattan in the year-to-date ending September.
"Food & beverage concepts continued to lead Manhattan’s retail leasing in 2025, accounting for 32.5% of YTD volume," Cushman & Wakefield said.
"Experiential dining remained high in demand, with quick-service restaurants, upscale eateries, and hybrid café formats driving activity."
The most significant signing in the restaurant segment was Bread & Butter, taking 11,804 square feet in Grand Central. But the largest lease overall was Chelsea Piers Management signing for 48,833 square feet in Hudson Square, followed by Neko Health taking over 42,000 square feet in the Upper West Side.
However, one category lagged — rents — which slipped by 0.7 percent from the previous 12 months, with 11 prime retail corridors in the borough seeing declines in average ground floor asking prices.
"Submarkets with the steepest rent reductions included Lower Manhattan (-5.9% YOY), Meatpacking (-4.3% YOY), and Lower Fifth Avenue (-3.3% YOY)," Cushman & Wakefield noted.
"While leasing activity remains strong across Manhattan, limited supply and persistent vacancies have placed downward pressure on asking rates."
As the low availability would point to a landlord's market, Cushman & Wakefield predicts that tenants will "pursue favorable commission structures and creative deal terms" to compete in the market while looking for expansion opportunities.