Retail rents have plummeted to historic lows in New York City amid the COVID-19 pandemic, as bankruptcies and vacancies penetrated the area, CNBC reported on Friday (Jan. 8).
Rent for retail space in New York City took a nosedive amid the pandemic, dropping about 25 percent from the same period in 2019, as longtime retailers like Neiman Marcus and Century 21 shuttered stores. Further, the biannual report released by the Real Estate Board of New York (REBNY), found that retail rents in Manhattan declined across all 17 corridors it tracks.
SoHo was part of the roughly eight areas in the city that saw their lowest average asking rents in at least a decade. And 11 areas saw an increase in available retail space on the market, from 6 percent up to 67 percent.
“Historic declines in rent across Manhattan’s most prominent retail corridors show just how much the market has adjusted amid the unprecedented impacts of the Covid-19 crisis,” REBNY President James Whelan told CNBC.
Fifth Avenue from 49th to 59th streets saw rental prices drop 8 percent, to $2,618 per square foot, REBNY’s data indicated, reflecting a 32 percent drop from the corridor’s peak rent in the spring of 2018. That area boasts high-end retailers like Saks Fifth Avenue and Cartier.
Several businesses also left the city because they could no longer handle the price of rentals, the report noted.
Whelan said that 32 areas closed down in SoHo last year, with about half of those closures taking place during the period when New York had ordered all nonessential businesses closed.
“Recovery is going to take years, not months,” Mark Dicus, executive director of the Soho Broadway Initiative business improvement district, told CNBC. “SoHo is uniquely positioned to continue to be that authentic neighborhood and that authentic place to come and shop in New York, but it’s going to take time for those investments to be made again.”