By: Romy Ronen
Landlords have now dropped their rent rates significantly in Manhattan’s shopping market, owing to a crisis that was on the verge of wrecking the city’s devoted businesses. Walk along Fifth Avenue, one of the most esteemed shopping meccas in the whole world, and notice how there are empty stores with empty shelves in an empty space, a space that used to be filled lavishly with clothing and accessories. Maybe it’s because, in the last ten years, landlords have demanded such a high rent, that even the most high fashion institutions can’t afford the demanding price.
And here are the numbers to prove this timely, pragmatic shift in rent price: according to the Real Estate Board of New York, in this year’s fall season, building owners have cut rent prices in 11 of 17 shopping locations. The average rent price on streets between 42nd and 49th is officially down nine percent to reach 852 dollars per square foot. The rent price on streets between 49th and 59th is down five percent from just last year. In SoHo, the most trendy shopping area (arguably in the entire United States) rent price is down 12 percent to reach 491 dollars per square foot. On Madison Avenue, vibrantly pristine and effortlessly graceful, rent is down 22 percent, to reach 906 dollars per square foot.
Decreased rent rates are a change made only for the better: businesses are opening up, and new, more affordable strategies are creating for fresh and unique selling ideas. REBNY reports that “an increased presence of pop-ups and promotional spaces indicate that brands are offering unique in-person experiences to attract both online and in-store shoppers.” The more creative the initiative, the more Manhattan’s economy benefits.
The entirety of Manhattan covers much ground, and not every landlord is following this lead. Although rents are decreasing in price in the most prestigious areas of Manhattan, some are left in the cold this winter. There are set places where asking rents have significantly increased, and only for the worst. In Lower Manhattan, specifically between Battery Park and Chambers Street, rents rose to 22 percent, averaging to 413 per square foot. On 125th street, a street between Columbia University and Harlem’s beginnings, rents rose eight percent, averaging to 125 per square foot.
Manhattan businesses, stores, institutions are currently thriving in lower rent environments. Landlords that control the Upper East Side domain, Soho, etc. gain benefits from lower rent prices in the long run: less shops are shutting down, suddenly prospering in this manageable economic standing.
