Manhattan retail recovery continues to gather momentum, but two of New York’s most famous shopping corridors, Times Square and Fifth Avenue, are lagging behind despite a strong return of tourist foot traffic.
According to a new biannual study by the Real Estate Board of New York, Times Square and the stretch of Fifth Avenue south of Central Park remain among the slowest areas to rebound. Together with two other districts, they accounted for nearly 60 percent of Manhattan’s available storefronts in the second half of last year, particularly large spaces exceeding 10,000 square feet.
Manhattan retail recovery uneven across corridors
While the broader Manhattan retail recovery shows no signs of slowing, performance varies sharply by location. The study found that asking rents are rising and prime storefronts are being snapped up quickly in neighbourhoods such as SoHo and Madison Avenue. In contrast, leasing activity in Times Square and upper Fifth Avenue has remained inconsistent.
Retailers have been hesitant to commit to these high-profile areas, with leasing often concentrated in only a few sectors. In Times Square, traditional dry goods and apparel stores have yet to return in meaningful numbers, while high buildout and financing costs have delayed several entertainment and immersive retail projects.
Times Square rents continue to slide
Despite steady pedestrian traffic, Times Square’s retail market remains in transition. The study reported that the average asking rent in the district fell 4.4 percent in the second half of the year to $1,850. That figure now sits 22 percent below its peak of $2,363 recorded in early 2016.
Although food, beverage, and novelty retailers have taken some space, many mid-sized and large storefronts remain available. The report noted that retail activity in Times Square has failed to match the competitive pace seen in other Manhattan shopping districts.
A separate analysis by JLL echoed these findings, showing that while Manhattan’s overall retail availability rate has dropped to a record low, Times Square continues to underperform relative to the rest of the borough.
Fifth Avenue faces similar challenges
The Fifth Avenue corridor between 49th and 59th streets has experienced similar headwinds. Although foot traffic remains strong, several storefronts have lingered on the market for extended periods. The study described many of the available spaces as highly specialised, often requiring substantial long-term commitments from potential tenants.
Average asking rents along this iconic stretch rose about 4 percent to $2,550 in the second half of the year. Even so, rents remain 27 percent below their 2016 peak of $3,484, highlighting the slow pace of recovery.
SoHo and Madison Avenue lead Manhattan retail recovery
In contrast, SoHo has emerged as one of the strongest performers in Manhattan’s retail recovery. Average asking rents in the neighbourhood jumped 17 percent to $726, while median rents are now just 12 percent below their all-time highs. Available storefronts have become scarce, with retailers moving quickly to secure space.
Madison Avenue has also seen robust demand, particularly among luxury brands. The stretch between 57th and 72nd streets recorded just 13 available storefronts in the second half of 2025, down sharply from earlier in the year. Over the past two years, the avenue has welcomed 78 new store openings.
Industry brokers note that competition in top-performing districts has become intense, with some leases closing above asking rents and multiple backup offers becoming increasingly common.
As Manhattan retail recovery continues, the gap between its strongest and weakest corridors underscores the shifting dynamics of post-pandemic retail demand, even in the city’s most iconic shopping destinations.
