Manhattan’s retail markets see historically low vacancy

9 July 2025

New York’s retail leasing market is getting tight.

Vacancies in Manhattan’s prime retail corridors reached their lowest number since JLL started releasing quarterly data on the metric in 2017, according to a new report from the brokerage. About 14 percent of retail spaces in those markets were available in the second quarter of 2025, dropping just over a percentage point year over year.

Asking rents in those corridors have not fully recovered, but they did notch a post-Covid record, reaching an average of $608 per square foot last quarter. That’s the highest number since the summer of 2020 and an 11 percent year-over-year jump.

“We’re at a historic low in the prime markets of retail availability and that’s a testament to how well New York is doing on the streetscape,” said Patrick Smith, a vice chairman for New York retail for JLL.

The prime retail areas include Times, Union and Herald Squares, along with Fifth Avenue, Madison Avenue, Soho and the Meatpacking District.

The lowest availability was found on Madison Avenue and in Soho, with 9.6 and 10.6 percent of spaces available, respectively. Madison Avenue, however, saw the largest decline in average asking rents, falling 14 percent year over year to $835 per square foot.

Soho, where rents are much cheaper, instead saw a 19 percent rise in average asking rent year over year, to $351 per square foot. The neighborhood also won two of the quarter’s biggest lease signings. Los Angeles Apparel will be moving into 24,700 square feet at 480 Broadway and members-only club Lightning Society signed for 19,000 square feet at 427 Broadway.

Herald Square saw the highest vacancy rate, with 35 percent of spaces available. Offerings in the area are typically large, Smith said, and there are not many retailers that can make those deals. Herald Square did see one major retail lease, however. Old Navy moved its flagship location down West 34th Street across Sixth Avenue, signing a 15-year lease for a 55,000-square-foot space in Herald Towers. It was the quarter’s — and the year’s — biggest retail lease by space.

As far as average asking rents, the biggest jump was found in the Times Square area, which saw a 19.3 percent jump year over year, to $1,555 per square foot. About 21 percent of spaces were vacant, however, in the district. Several buildings in the area are owned by lenders, Smith said, making their long-term ownership unclear to retailers.