Average asking rents increased year over year in 10 of 16 of Manhattan’s major retail corridors, the Real Estate Board of New York (REBNY) reported in its H1 2024 Manhattan Retail Report. However, no corridor has returned to its pre-pandemic rent peak.

Brokers who contributed to the REBNY report noted sustained demand in many corridors in the first six months of 2024, particularly from food and beverage as well as apparel. Increasing office visitation rates and growing tourist activity has supported strong demand. With limited availability in the most sought-after corridors, retailers have expanded their activity to areas like the Upper West Side and Grand Central.

Professionals surveyed for the report noted some ongoing challenges. Although many potential businesses are seeking smaller and mid-sized storefronts, the pool of retailers seeking larger spaces is more limited. In addition, delays in permitting and licensing, elevated buildout costs, and restrictive lending also inhibit lease completion and store openings.

Nonetheless, anticipated record tourism in the next several quarters, sustained return to office and recent City of Yes Economic Opportunity reforms all provide cause for a positive outlook for Manhattan retail, according to REBNY.