Spring 2009

Stephen M. Ross,
Chairperson

Steven Spinola,
President

570 Lexington Avenue / New York, NY 10022 / 212.532.3100

www.rebny.com
 Spring 2 0 0 9
Ex ecutiv e Summary
M anhattan average asking rents for all
available space declined 11 percent from
the Fall 2008 to $115. Each of the borough’s
six geographic areas showed a decline in the
average asking rent for all available space,
ranging from 6 percent in Midtown to 22 per-
cent on the West Side compared to six months
earlier. Double digit declines in the average
asking rent for all available space were reported
on the East Side (12 percent), Midtown South
(14 percent), Downtown and Upper Manhattan
(13 percent).
These declines in the average asking rent for
all space are from market highs in the fall 2008.
In most cases, the average rents for Manhattan
and the borough’s six geographic areas are com-
parable to asking rents from a year ago.
Since September 2008, the turmoil in the
financial markets has reverberated through the
real estate industry and the retail market.
Despite this uncertainty, our Advisory Group
reports that leasing activity is occurring
throughout Manhattan. More interestingly, new
retail tenants are looking at store space in New
York for the first time. No doubt declining
prices are attracting tenants for whom the city is
becoming more affordable.
The average asking rent for ground floor
space in many of the major retail corridors
highlighted in the report likewise showed
declines compared to Fall 2008. Madison
Avenue declined 14 percent, Broadway on the
Upper West Side declined 5 percent and Fifth
Avenue in the 50s fell 3 percent from Fall 2008.
In a few corridors, such as Fifth Avenue in
the Flatiron District and Broadway in SoHo, the
average asking rent for ground floor space
showed a modest gain. Our Advisory Group
noted that in this economy owners are uncertain
about what is an appropriate asking rent.
Hence, they do not modify the asking rent
which could have been set as much as a year
ago. Instead, they would offer a longer free
rent period and a more generous build out
allowance. These economic incentives vary
from owner to owner.
1
A few years ago, in our meeting to review
our report, our Advisory Group began to
express concern about the steep rise in asking
rents. They believed that asking rent increases
in the major retail corridors in Manhattan were
outpacing overall economic growth and ques-
tioned the sustainability of these asking rent
increases. Accordingly, they see the recent
decline in asking rents as an anticipated market
correction in a market that was experiencing
unsustainable rent growth.
In our tumultuous economy it is crucial to
examine all the asking rent information—aver-
age, median and range of ground floor space—
in assessing the market conditions of an indi-
vidual major retail corridor and evaluating ask-
ing rents for individual stores.
An emerging issue identified by our
Advisory Group is the rise in sublet space. In
earlier reports, this sublet space was virtually
indistinguishable from space marketed directly
by the landlord and was included in our reports.
Going forward, our Advisory will be examining
the asking rents for sublet space listings. Those
listings that reflect market conditions (compara-
ble rent with a term of 7 years or more) in a par-
ticular location will be included. In situations
where there are sublet listings with shorter lease
terms we will attempt to determine if these sub-
leases are likely to be converted to long-term
leases with the participation of the building
owner. Those listings, however, in which the
asking price reflects economic distress of the
tenant and significantly lower than other avail-
able space in the market will be omitted.
The goal of our report is to provide com-
plete, comprehensive information—the major
neighborhoods and prime corridors in
Manhattan—on the retail market. With the
invaluable assistance of our Advisory Group,
we have attempted to alert the readers of our
report to factors that are not captured by the
rent data. This information is critical to under-
standing the market.
We hope in these challenging times you find
our report informative and useful.
 Spring 2 0 0 9

AVERAGE ASKIN G RENT : SELECTED MAJOR RETAIL

C ORRIDORS Available Gr ound Floor Space Only
Spring Fall Spring % Change % Change
2009 2008 2008 From Fall From Spring
2008 2008
EASTSIDE
Madison Ave: 57 - 72 St $979 $1,143 $1,066 -14% -8%
Third Ave: 60 - 72 St $275 $287 $329 -4% -16%
East 86 St: Lexington Ave - 2nd Ave $400 $475 $450 -16% -11%
WESTSIDE
Broadway: 72 - 86 St $293 $309 $384 -5% -24%
Columbus Ave: 66 - 79 St $257 $300 $268 -14%
MIDTOWN
MIDTOWN
East 57 St: 5 Ave - Park Ave $900 $600 n/a 50% n/a
Fifth Ave: 42 - 49 St $615 $550 $704 12% -13%
Fifth Ave: 49 - 59 St $1,631 $1,675 $1,958 -3% -17%
Broadway & 7 Ave: 42 - 47 St $1,381 $775 $809 78% 71%
MIDTOWN
MIDTOWN SOUTH
Flatiron
Fifth Ave: 14 - 23 St $285 $276 $401 3% -29%
Herald Square
West 34 St: 5 - 7 Ave $508 $643 $656 -21% -23%
Meatpacking
14 St: 9 - 10 Ave $417 $304 $462 37% -10%
DOWNTOWN
DOWNTOWN
Financial District
Broadway: Battery Park - Chambers St $251 $251 $198 0% 27%
SoHo
Broadway: Houston - Broome St $452 $432 $424 5% 7%
West Village
Bleeker St: 7 Ave South - Hudson St $528 $362 $397 n/a 33%
UPPER MANHATT
MANHATTAN
AN
Harlem
125th St. (River to River) $119 $125 $107 -5% 11%

2
 Spring 2 0 0 9

MEDIAN ASKIN G RENT : SELECTED MAJOR RETAIL

C ORRIDORS Available Gr ound Floor Space Only
Spring Fall Spring % Change % Change
2009 2008 2008 From Fall From Spring
2008 2008
EASTSIDE
Madison Ave: 57 - 72 St $1,000 $1,140 $1,121 -12% -11%
Third Ave: 60 - 72 St $250 $300 $342 -17% -27%
East 86 St: Lexington Ave - 2nd Ave $400 $450 $450 -11% -11%
WESTSIDE
Broadway: 72 - 86 St $300 $316 $325 -5% -8%
Columbus Ave: 66 - 79 St $271 $300 $288 -10% -6%
MIDTOWN
MIDTOWN
East 57 St: 5 Ave - Park Ave $600 $600 n/a 0% n/a
Fifth Ave: 42 - 49 St $506 $550 $455 -8% 11%
Fifth Ave: 49 - 59 St $1,561 $1,500 $1,958 4% -20%
Broadway & 7 Ave: 42 - 47 St $1,450 $775 $809 87% 79%
MIDTOWN
MIDTOWN SOUTH
Flatiron
Fifth Ave: 14 - 23 St $250 $271 $400 -8% -38%
Herald Square
West 34 St: 5 - 7 Ave $500 $640 $672 -22% -26%
Meatpacking
14 St: 9 - 10 Ave $400 $300 $467 33% -14%
DOWNTOWN
DOWNTOWN
Financial District
Broadway: Battery Park - Chambers St $200 $200 $225 0% -11%
SoHo
Broadway: Houston - Broome St $480 $400 $421 20% 14%
West Village
Bleeker St: 7 Ave South - Hudson St $525 $304 $332 73% n/a
UPPER MANHATT
MANHATTAN
AN
Harlem
125th St. (River to River) $100 $115 $92 -13% 9%

3
 Spring 2 0 0 9

ASKIN G RENT RAN GE: SELECTED MAJOR RETAIL

C ORRIDORS Available Gr ound Floor Space Only
Spring 2009 Fall 2008 Spring 2008

EASTSIDE
Madison Ave: 57 - 72 St $700 - $1,200 $704 - $1,667 $600 - $1,538
Third Ave: 60 - 72 St $200 - $400 $184 - $503 $300 - $350
East 86 St: Lexington Ave - 2nd Ave $400 - $400 $325 - $781 $400 - $500
WESTSIDE
Broadway: 72 - 86 St $236 - $325 $168 - $450 $325 - $620
Columbus Ave: 66 - 79 St $162 - $325 $131 - $447 $150 - $348
MIDTOWN
MIDTOWN
East 57 St: 5 Ave - Park Ave $600 - $1,500 $400 - $800 $0 - $0
Fifth Ave: 42 - 49 St $432 - $1,333 $300 - $800 $325 - $1,333
Fifth Ave: 49 - 59 St $1,200 - $2,200 $1,200 - $2,500 $1,915 - $2,000
Broadway & 7 Ave: 42 - 47 St $622 - $2,000 $550 - $1,000 $618 - $1,000
MIDTOWN
MIDTOWN SOUTH
Flatiron
Fifth Ave: 14 - 23 St $200 - $400 $238 - $325 $300 - $556
Herald Square
West 34 St: 5 - 7 Ave $475 - $550 $500 - $791 $450 - $830
Meatpacking
14 St: 9 - 10 Ave $400 - $450 $250 - $400 $320 - $600
DOWNTOWN
DOWNTOWN
Financial District
Broadway: Battery Park - Chambers St $100 - $400 $100 - $500 $75 - $400
SoHo
Broadway: Houston - Broome St $333 - $550 $220 - $800 $275 - $600
West Village
Bleeker St: 7 Ave South - Hudson St $393 - $667 $130 - $800 $265 - $600
UPPER MANHATT
MANHATTAN
AN
Harlem
125th St. (River to River) $75 - $200 $80 - $222 $40 - $220

4
 Spring 2 0 0 9

ASKIN G RENT : MAJOR RETAIL NEIGHB ORHOODS

All Available Space (Ground
(Ground floor
floor,, low
low er Le v el, Upper
Upper le v el, mezzanine)
Spring Fall Spring % Change % Change
2009 2008 2008 From Fall From Spring
2008 2008

MANHATT
MANHATTAN
AN $115 $129 $111 -11% 4%

EASTSIDE $168 $190 $164 -12% 2%

60th Street to 96th Street, Fifth Avenue to the East River

WESTSIDE $116 $147 $123 -22% -6%

60th Street to 116th Street, West of Morningside Park

MIDTOWN
MIDTOWN $152 $161 $145 -6% 5%
35th Street to 59th Street

MIDTOWN
MIDTOWN SOUTH $96 $111 $96 -14% 0%
15th Street to 34th Street

DOWNTOWN
DOWNTOWN $95 $110 $103 -13% -8%
South of 14th Street

UPPER MANHATT
MANHATTAN
AN
97th Street and higher, Fifth Avenue to the East River; $52 $60 $60 -13% -13%
116th Street and higher, West of Morningside Park

5
 Spring 2 0 0 9

SELECTED MARKET DATA

Manhattan Retail Square Feet by Area (millions of square feet)
East Side
N. Manhattan 9.6
10.3 West Side
9.4% 8.8% 4.4
4.0%
Downtown
21.2 19.3%
26.2%

32.2% Midtown
28.8

Midtown South
35.4

New York City Employment (in thousands)

3,850
3,790
3,800
3,750
3,700
3,650 3,619
3,600 3,580
3,539
3,550
3,490 3,499
3,500
3,450
3,400
3,350
3,300
2008 2009 2010 2011 2012 2013

New York City CPI (1982-1984=100)

255
250.1
250
244.3
245
238.9
CPI

240 R
235.8 235.1
235
230
225
220
2008 2009 2010 2011 2012 2013

6
 Spring 2 0 0 8

SELECTED MARKET DATA

New York City Real Gross City Product (billions)

$500.0
$486.2
$480.0

$457.7
$460.0
$447.6

$440.0 $433.0
$427.8
$419.8
$420.0

$400.0

$380.0
2008 2009 2010 2011 2012 2013

New York City Gross Personal Income

$480.0

$460.0 $456.6

$437.1
$440.0
$420.8 $419.4
$420.0
$406.1 $406.1

$400.0

$380.0
2008 2009 2010 2011 2012 2013

Personal Income (In Thousands)

7
 80
100
120
140

$80
$100
$120
$140
$160
$80
$100
$120
$140
$160
$80
$100
$120
$140
$160
$180
$200
96
F-2000
F-2000 F-2000

$115
F-2000

$103
$133
98
S-2001
S-2001 S-2001

$122
S-2001

$92
$138
84
F-2001
F-2001 F-2001

$107
F-2001

$92
$103
87
S-2002
S-2002 S-2002

$109
S-2002

$91
$113
85
F-2002
F-2002 F-2002

$110
F-2002

$100
$111

Midtown
Manhattan

Westside
88
S-2003

Eastside
S-2003 S-2003

$112
S-2003

$104
$128
92
F-2003
F-2003 F-2003

$121
F-2003

$107
$143
97

S-2004
S-2004

$111
S-2004

$125
S-2004

$155
97

F-2004
F-2004 F-2004

$129
F-2004

$136
$148

8
S-2005
103

S-2005 S-2005

$132
S-2005

$127
$160
102

F-2005

$128
F-2005 F-2005

$186
F-2005

$107
S-2006
108

S-2006 S-2006

$138
S-2006

$123
$178
F-2006
106

F-2006 F-2006

$137
F-2006

$122
$161
Spring 2 0 0 9

S-2007
107

S-2007

$133
S-2007 S-2007

$128
$155

F-2007
118

F-2007 F-2007

$156
F-2007

$135
$170

S-2008
111

S-2008

$145
S-2008 S-2008

$123
$164
129

$161
F-2008

$147
$190

F-2008 F-2008 F-2008

S-2009
115

S-2009 S-2009

$152
S-2009

$116
$168
Average Retail Asking Rents PSF
 $40
$50
$60
$70
$80
$60
$70
$80
$90
$100
$110
$120

$50
$70
$90
$110
F-2000

$51
F-2000

$79
F-2000

$67
S-2001

$47
S-2001

$78
S-2001

$60

$43
F-2001
F-2001

$70
F-2001

$60
S-2002

$53
S-2002

$74
S-2002

$58
F-2002

$50
F-2002

$71
F-2002

$59
S-2003

$53
S-2003

$70
S-2003

$58
Downtown
Midtown South
F-2003

$50
F-2003

$74
F-2003

$58

Upper Manhattan
S-2004

$51
S-2004

$75
S-2004

$59
F-2004

$50
F-2004
$78
F-2004

$73
S-2005

$50
S-2005
$73

S-2005

9
$48
$82

$82 $85
F-2005 F-2005 F-2005

S-2006 S-2006

$47
$85

S-2006

$90
F-2006 F-2006

$50
$85

F-2006

$92

$56
S-2007 S-2007
$89

S-2007

$98
Spring 2 0 0 9

F-2007 F-2007
$94

$76
F-2007

$95
S-2008 S-2008
$96

S-2008

$103
$111

$110

$60 $60
F-2008 F-2008 F-2008

S-2009 S-2009
$96

$52
S-2009

$95
Average Retail Asking Rents PSF
 Spring 2 0 0 9

acknowledgements
The REBNY Retail Report Advisory Group includes:

Robin Abrams, The Lansco Corporation

J
Karen Bellantoni, Robert K. Futterman & Associates, LLC
J
Benjamin Fox, Winick Realty Group
J
Andrew Goldberg, CBRE
J
David Green, Cushman & Wakefield
J
Joanne Podell, Cushman & Wakefield
J
Fred Posniak, W&M Properties of New York, LLC
J
Jeffrey Roseman, Newmark Knight Frank
J
Alan Victor, The Lansco Corporation

T he Retail Report provides objective, comprehensive

information about asking rents and market trends in
Manhattan.

Issued twice a year—Spring and Fall—the report is a

project of the REBNY Retail Committee.

The report presents retail space information by geo-

graphical area and focuses on the asking rent of the
ground floor space on the major retail streets.

10