Economic headwinds persist — but that isn't enough to stop retail's resilience in New York City.
JLL's report covers the Prime markets, which include areas such as SoHo, Times Square, Fifth Avenue, Williamsburg and Madison Avenue. It found that the availability rate stayed at a record low of 13.7 percent at the end of the first quarter. This rate was the same as the fourth quarter of 2025, with JLL's tracking dating back to the third quarter of 2017.
Yet only three submarkets saw their availability drop: SoHo, Meatpacking and Herald Square/ 34th St.
Average asking rents rose modestly, up $11 per square foot on a quarterly basis and 1.4 percent year-over-year to $585 per square foot. The largest rent year-over-year increase was seen on the Lower Fifth Avenue submarket (31.7 percent), with four submarkets seeing rent drops, including Times Square, 34th Street/Herald Square, Upper Fifth Avenue and Williamsburg.
The strong results came even as JLL noted the economic headwinds that persisted, which included tariffs and the winter weather. The CRE brokerage added that economic activity declined, with wages only growing modestly and consumers pulling back on major purchases. Particularly, "smaller retailers saw a sharp decline in activity" as spending in the food and beverage sector increased "somewhat."
"The data reinforces that New York remains one of the most important retail markets in the world. Even with limited availability, we're continuing to see strong demand from both established global brands and new concepts that want a presence here," Patrick A. Smith, vice chairman of retail brokerage at JLL New York, said in comments to GlobeSt.
"What's changed is that with fewer spaces available and a more selective consumer, retailers are being much more deliberate, focusing on the locations that will truly drive brand visibility and performance. That's why the top corridors are continuing to see strength, even as the broader environment remains uncertain."
Going forward, due to the limited options for tenants to choose from, Smith predicts that more retail activity in NYC will happen in non-core submarkets.
Balloon Museum signed the biggest first-quarter lease, taking 54,000 square feet in the Seaport submarket. That was followed by Chelsea Piers and TJ Maxx, which leased 47,000 square feet and 46,437 square feet, respectively, in Hudson Square and Midtown.
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