Experiencing the largest rent decrease in five years, rents across all of New York City's prime retail corridors dropped by 13.5% year-over-year on average, according to a new report from JLL Research.
However leasing velocity continues to trend upwards, increasing by 24.1% quarter-over-quarter in Q4. Essential businesses continue to drive leasing, accounting for 56.7% of new deals signed, a trend that has been observed since pre-COVID.
The rent decrease in five years also accounted for the sizable increase in deal volume: Although total deal volume is still down 31% from the same period in 2019, Q4 accounted for the highest quarterly deal count since Q1 2020.
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Average Availability Inches Downward
Average availability continues to inch downward, coming in at 27% in Q4, down very slightly from 27.1% in Q3.
"Once again, the good news here is the way things are trending: the previous peak of 27.9% observed in Q2 2021 was the highest rate in the last 10 years, so it's evident that conditions are continuing to improve," JLL said.
"There is a direct correlation between increased leasing activity and decreased availability, as retailers continue to capitalize on tenant-favorable market conditions to secure high-quality space for cheap."
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