“We continued to see positive indicators of the strength of Manhattan’s retail market in Q2. Notably, 10 out of Manhattan’s 11 premier retail submarkets saw rates fall below pre-pandemic levels recorded in Q2 2019,” said Dana Mischler, Senior Research Analyst for Cushman & Wakefield. “Food and beverage concepts continue to drive leasing momentum, accounting for 37.7% of total retail leases in 2025 year-to-date. This underscores the evolving role of experiential retail as a key demand driver in a post-pandemic landscape, ultimately creating more competition for space and impacting both availability and rents.”
The Upper East Side and Upper West Side submarkets reported availability under 10%, as new apparel brands, cafés, and fitness concepts increasingly target these densely populated residential neighborhoods. Meanwhile, Flatiron/Union Square has reported a 15.2% reduction in retail space availability since Q2 2021. This improvement has been fueled by leasing activity driven by national apparel brands and quick-service restaurant chains. Other high-demand areas, such as Madison Avenue and SoHo, have also experienced growing interest, leading to a 25.0% increase in asking rents compared to their lows in Q1 2022.
Asking rent trends varied across Manhattan’s prime retail corridors. While seven of the 11 submarkets posted year-over-year rent declines, the borough managed to achieve a modest 1.0% annual increase overall. This reflects localized shifts in demand and pricing dynamics across different neighborhoods.