January is fantasy season for Manhattan’s retail-leasing scene. Leading brokerages and business improvement districts want us to believe that long-vacant storefronts are filling up like crazy and tenants who delay to make deals will be left out in the cold.
However, what we see with our eyes is a situation much less cheery than institutional data suggest.
JLL claims the “prime retail market closed 2025 at its tightest point on record, with availability falling to a historic low of 13.7%.”
JLL defines “prime” not by a location’s size or suitability for retailing but by districts, such as upper Fifth Avenue, Herald Square and Soho. The only one where vacancies are truly scarce is Soho. And should we celebrate a “mere” 13.7% vacancy rate citywide, if that figure is even accurate?
The most optimistically skewed reports reveal many more dark storefronts than in the city which is New York’s chief rival on the global scene: London. The vacancy rate across the British capital is just 6.8%, according to Avison Young.
In a more efficient New York market before online shopping — and before developers built new retail space even as demand was falling or they re-developed older buildings to price previously $200-per-square-foot sites at $1,000 — empty storefronts were relatively few.
And 13.7% vacancy is historically low? Look at old photos of Fifth Avenue and Times Square from as recently as the 1980s and you’ll see nary a “FOR RENT” sign.
Today, CBRE tagged New York City storefront vacancies at 15% — which it hastened to point out is (duh) lower than it was during the peak of the pandemic.
Like JLL, CBRE said that the largest new “retail” leases were for nontraditional uses. “F&B and Fitness Brands Lift the Market,” the company said.
But it would be more truthful to say that food, fitness, laser salons and walk-in pet clinics only saved the market from utter calamity.
Retail brokers work as hard as their office-leasing counterparts and deserve support for coping with a challenging market.
But on CBRE’s list of the largest “retail” leases in 2025, only one was for an actual store — not a new one, but a renewal by Victoria’s Secret on East 86th Street.
JLL’s list included exactly one actual store – Aritzia at 115 Fifth Ave. The others were event spaces, fitness clubs, a charter school, restaurants and even a fertility clinic.
JLL’s vice-chairman for retail brokerage, Patrick A. Smith, commented: “Prime New York retail fundamentals remain exceptionally strong, driven by sustained demand and a chronic lack of quality supply. In core corridors, well-located space is leasing quickly, pricing is resilient and decision-making has become far more strategic as tenants compete for fewer opportunities.”
That sounds as if merchants must ACT TODAY to open stores or expand. But large empties abound on Fifth Avenue in the East 50s and all over FiDi.
Sixth Avenue north of 42nd Street has numerous large, highly visible vacancies despite the packed sidewalks and office buildings along the stretch.
Among them: the ground-floor space at 1212 Sixth Ave. between West 47th and 48th streets, a former Gap store, has stood empty for six years despite its world-class location.
The leasing agent is JLL — the same outfit that would have us celebrate a retail revival.
H&M shut down two Manhattan stores, leaving huge holes at the World Trade Center and on the Upper East Side. Eighteen national chains closed a total of 112 Big Apple locations in 2025, according to the Center for an Urban Future. Many were jumbos such as Staples and Old Navy; new Dunkin’ Donuts branches won’t make up for the losses. And who knows what local fallout will result from Saks Global’s impending Chapter 11 filing?
The city will survive the retail shortfall. But sugarcoating the truth won’t help. It will only encourage builders and landlords to create more overpriced storefronts — and be surprised when there are no takers.
